TechTalk Blog - US SEC Adopts Resource Extraction Rules for Public Company Disclosure Using Global XBRL Data Format

By David Colgren posted 06-28-2016 08:40 AM

  

Yesterday the US Securities & Exchange Commission adopted resource extraction rules using the open, freely-available, XBRL data format supported by the IMA for more effective transparency and accountability.  This rule is a major CSR/ESG/Sustainability Initiative for Public Company Disclosure. 

From TheCorporateCounsel.net:

The rules were originally adopted in 2012 – but were then struck down by the US District Court for DC in 2013. The rules were re-proposed in December after being sued by Oxfam America for not moving fast enough – and a court ordered that they be re-proposed. When the SEC re-proposed the rules, it promised to adopt the rules by June 27th – and yesterday they issued the rules.

Click here on the 268-page adopting release.

From the US SEC Issued Press Release:

"In a separate order issued today, the US SEC determined that the current reporting requirements of the European Union Accounting and Transparency Directives (as implemented in a European Union or European Economic Area member country), Canada’s Extractive Sector Transparency Measures Act, and the U.S. Extractive Industries Transparency Initiative (USEITI) are substantially similar to the Commission’s rules, subject to certain conditions specified in the order and in the final rules." 

Background Related to the New Rules for Public Company Disclosure:

Required by the 2010 Dodd-Frank Wall Street reform law, the rule calls for oil, gas and mining companies to disclose how much they pay governments in taxes, royalties and other types of fees for exploration, extraction and other activities.

Section 1504 of the Dodd-Frank Act added Section 13(q) to the Securities Exchange Act of 1934, which directs the SEC to issue rules requiring resource extraction issuers to include in an annual report information relating to any payment made by the issuer, a subsidiary of the issuer, or an entity under the control of the issuer, to a foreign government or the Federal Government for the purpose of the commercial development of oil, natural gas, or minerals. Section 13(q) requires a resource extraction issuer to provide information about the type and total amount of such payments made for each project related to the commercial development of oil, natural gas, or minerals, and the type and total amount of payments made to each government.

The rules would require resource extraction issuers to file a Form SD on an annual basis that includes information about payments related to the commercial development of oil, natural gas, or minerals that are made to governments.

Resource extraction issuers would be required to present the payment disclosure using the eXtensible Business Reporting Language (“XBRL”) electronic format and the electronic tags identified in Item 2.01 of Form SD. These tags would include those listed in Section 13(q), as well as tags for the type and total amount of payments made for each project, the type and total amount of payments made to each government, the particular resource that is the subject of commercial development, and the subnational geographic location of the project.



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