Judge orders rule on foreign energy payments

A federal judge ordered financial regulators Wednesday to move forward on a long-delayed rule to require oil, natural gas and mining companies to disclose payments to foreign governments.

Congress told the Securities and Exchange Commission (SEC) to write the regulation in 2010 as part of the Dodd-Frank financial reform law.

{mosads}But its been tied up in controversy and litigation by oil interests and the SEC has pushed past a number of deadlines, angering groups like Ox­fam Amer­ica, which filed a lawsuit in a Massachusetts federal court to get the ball rolling on the rule.

Judge Den­ise J. Casper concluded Wednesday that the SEC’s continued delays are a clear violation of the law, but he did not go so far as to mandate a timeline for the rule.

“The court con­cludes … that the SEC’s delay in pro­mul­gat­ing the fi­nal ex­trac­tion pay­ments dis­clos­ure rule can be con­sidered ‘un­law­fully with­held’ as the duty to pro­mul­gate a fi­nal ex­trac­tion pay­ments dis­clos­ure rule re­mains un­ful­filled more than four years past Con­gress’s dead­line,” Casper wrote.

The regulation was meant to crack down on foreign governments that use money from extractive industries to further corruption, conflict or other strife, especially in sub-Saharan Africa.

The SEC issued the rule in 2012, but following a lawsuit by the American Petroleum Institute, it was overturned in court. That court said that the SEC improperly refused to consider that companies can be held to non-disclosure agreements by the foreign governments with whom they have contracts.

Oxfam called Wednesday’s decision a victory.

“Today’s ruling compels the SEC to move quickly to provide relief to citizens and investors who have been waiting for strong transparency requirements for more than five years,” Ian Gary, a policy expert with the group, said in a statement. “The task before [Chairwoman] Mary Jo White’s SEC is now crystal clear: a rule must be issued urgently.”