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US seeks reports on resource acquisition

US seeks reports on resource acquisition

A SWEEPING financial reform bill passed by the United States Senate last week will force US-listed oil, gas and mining companies to publicly divulge payments made to secure access to resources in foreign countries including Cambodia.

The provisions, passed on Thursday as part of the 2,300-page Dodd-Frank Wall Street Reform and Consumer Protection Act, will require the companies to disclose the payments to the US securities and exchange commission by 2012.

Companies will be obliged to report to the SEC the “type and total amount of such payments made for each project”, as well as “the type and total amount of such payments made to each government”.

These include “taxes, royalties, fees (including licence fees), production entitlements, bonuses, and other material benefits” relating to extractive industry revenues.

Cambodia is home to somepublicly traded resource companies – including Chevron, Total, Petronas, ConocoPhillips and Mitsui & Company Ltd – that would be required to publicise further payments made to secure oil-exploration rights or offshore oil concessions in the Kingdom under the newly passed legislation.

In April, Prime Minister Hun Sen revealed that French oil giant Total had paid US$28 million to secure offshore oil exploration rights in the Gulf of Thailand, prompting requests for further disclosures.

In a statement on Friday, Oxfam America applauded the new regulations, saying they would improve the transparency of public revenues in Cambodia.

“Public disclosure of revenues and how they flow from industry to government is fundamental to improving governance, helping any government’s efforts to prevent and curb corruption, and improve revenue management,” Mona Laczo, Oxfam America’s deputy regional director for East Asia, said in the statement.

Ou Virak, president of the Cambodian Centre for Human Rights, also welcomed the new bill, saying the issue of under-the-table payments had long been a concern in the extractive resources industry.

“It is a good thing for the US to pass a bill that forces companies to disclose all unofficial fees,” he said. “I think it will be far-reaching.”

Council of Ministers spokesman Phay Siphan said he was not familiar with the new regulations, but reaffirmed the government would pursue resource revenue transparency “in the same spirit” as in its fight against corruption.

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