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Public Statements

Outer Continental Shelf Transboundary Hydrocarbon Agreements Authorization Act

Floor Speech

By:
Date:
Location: Washington, DC

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Ms. WATERS. Mr. Speaker, as ranking member of the Financial Services Committee and a member of the conference committee that passed the Dodd-Frank reform legislation, I rise in opposition to H.R. 1613. I oppose the bill because of the exemption it includes for companies from the transparency requirements under section 1504 of Dodd-Frank Act.

Section 1504 of Dodd-Frank requires companies to disclose payments they make to governments for oil, gas, and mining resources. It covers companies listed on U.S. exchanges, including the U.S., Chinese, Brazilian, Canadian, European, Australian and other companies.

Section 1504 has a long legislative history. The Financial Services Committee held its first hearing on extracted industry transparency in 2007. In 2008, our committee held a legislative hearing where we debated the specific provisions that eventually became law. The Senate introduced similar legislation, and they held hearings.

The provision was adopted into the Dodd-Frank Act through a bipartisan amendment. Then, before issuing a rule to implement the law, the Securities and Exchange Commission solicited input, held meetings, and considered hundreds of comments from industry, trade groups, Members of Congress, and civil society. Section 1504 was very carefully considered by Congress over the course of several years, with input from all quarters. It is now the law of the land.

Let me tell you why it's important.

Public disclosure of extractive industry payments help diminish the political instability caused by OPEC governance, which is not only a threat to investment, but also to our own national security. Resource revenue transparency also allows shareholders to make better informed assessments of opportunity costs, threats to corporate reputation, and the long-term prospects of the companies in which they invest.

Countries rich in natural resources are often developing countries that are politically unstable, many rife with corruption, with a history of civil conflict fueled, in part, by natural resources.

Opening the extractive industries to greater public scrutiny is key to increasing civil society participation in these countries. This is crucial in order for citizens in resource-rich countries to be able to demand greater accountability from their governments for spending that serves the public interest. This in turn can help reduce poverty and create more stable, democratic governments. It can also help create more stable business environments.

The provision in H.R. 1613 that exempts companies from the disclosure requirements under section 1504 is entirely unnecessary. The bipartisan Senate version of this bill includes no such exemption.

Also, the U.S.-Mexico agreement explicitly respects the domestic laws of both countries, so it already accommodates the Dodd-Frank disclosure requirement. Moreover, there are no laws in Mexico that would prohibit the disclosure of company payments.

Let's also listen to what the administration has to say about this. After all, this administration negotiated the terms of the agreement with Mexico. The administration very much wants legislation to implement the agreement, and they know what they need to do this. And they don't want this bill.

The White House issued a statement strongly opposing H.R. 1613 precisely because of the provision waiving the requirements for the public disclosure of extractive payments to governments. The exemption in this bill is nothing more than an effort to undermine transparency and to undo good public policy that has become an international standard.

I urge my colleagues to oppose this bill in its current form. Members deserve the opportunity to vote on a clean bill that they can support, and I urge the leadership to give the House that opportunity.

Ladies and gentlemen, you have heard talk from both sides of the aisle about how important this bill could be without this exemption. Why would you undo the work of both sides of the aisle, the conference committee, the Senate, and all in working out this agreement by putting this exemption in?

I want you to know that those of us who are working very hard to make sure that we implement reform, those of us who are very much involved with Dodd-Frank, we not only understand all of the ways that people are trying to get around Dodd-Frank, to get under Dodd-Frank, to undo the reforms of Dodd-Frank, why does this exemption show up in this bill? It has no place in this bill. This is another attempt to get around Dodd-Frank and not to comply with the law, and you're messing up a good agreement. It does not make good sense.

I oppose this bill in this form. The administration opposes this bill in this form. And if you want the kind of agreement that you say you want with Mexico, if you're interested in sharing those resources, if you're interested in what you claim can be done creating jobs, you would not move forward with this bill. You would not try to force this exemption on this agreement.

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Ms. WATERS. Mr. Speaker and Members, I hear my friends on the opposite side of the aisle keep talking about this is as bipartisan as you can get. It was bipartisan before you sneaked in the exemption that would allow companies to bribe governments and pay under the table and create chaos in other countries. It was a bipartisan agreement.

I keep hearing reference to this having the support of the administration. Let me be clear. This bill, in this form, does not have the support of the administration. It did have before you sneaked in the exemption.

Dodd-Frank made it very clear. It is the law. We worked very hard. Both sides of the aisle, in the conference committee, worked on this part of the bill. And now we have you coming in the dark of the night, one more time trying to undo Dodd-Frank. And this is awful. It is really, really awful because we have the opportunity to have an agreement with Mexico where we could both benefit from the drilling, and we all support that.

But, no, you have decided to undermine the work of both sides of the aisle by putting this exemption in this bill, and so it does not have the support of the administration. It is no longer bipartisan. We no longer support it. And you have the possibility of a veto on your hands.

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Ms. WATERS. Well, I just want to make clear what this exemption is they're trying to do. It's a very simple request that's in law that says just tell us what you're paying. And we have now included in this bill, where there is an agreement, an exemption that will not allow them or keep them from being able to share that information.

As you said, they would now, if this passed, they would be able to make payments in secret. They would be able to make bribes. They would be able to maybe even be disruptive to countries that they are paying bribes to when they get into these conflicts in other countries.

So why would they want to do this? I don't understand it. I thought maybe you may have some additional information that I don't have. But to mess up an agreement simply because you want to protect the oil companies from saying how much they're paying is beyond my comprehension.

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Ms. WATERS. Just as you have come to some conclusion that maybe we are opposing this bill because we're opposed to offshore drilling, which is not true----

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Ms. WATERS. Thank you very much.

When you raised the question about why didn't we offer an amendment and the Senate can offer an amendment, I have drawn a conclusion. Why are you trying to get credit for putting this in the bill with the oil companies?

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