In a move global rights groups are decrying as a Valentine's Day gift to Big Oil, President Donald Trump on Tuesday officially voided a rule that forced extractive industries to disclose payments made to foreign governments.
The transparency law, known as the Cardin-Luger amendment, was an Obama-era rule established to prevent multinational energy companies from striking backroom deals with corrupt governments. As Common Dreams previously reported, the years-long lobby effort against it was led by ExxonMobil under the leadership of former CEO and newly-confirmed Secretary of State Rex Tillerson.
As The Hill noted, Tuesday's signing marks the onset of "an aggressive deregulatory effort that the Trump administration and the GOP Congress are undertaking to roll back Obama-era rules on fossil fuel companies, financial institutions, and other businesses that they say have suffered for the last eight years."
But global humanitarian groups have warned that repeal of the anti-corruption measure will most impact the world's poor, as funds that were once considered public revenue will now line the pockets of leaders of resource-rich nations.
"Citizens and civil society organizations are generally starved of information critical to hold to account government and mining companies on the management and utilization of the country's abundant mineral wealth," Mukasiri Sibanda with the Zimbabwean Environmental Law Association recently explained to the Guardian. Sibanda added that scrapping Cardin-Lugar is "thoughtless and regressive."
As the Guardian pointed out, abolishing the regulation means 425 companies traded on the U.S. stock exchange, including oil giants Exxon and Chevron, will no longer have any requirements to report their payments to foreign governments.
SCROLL TO CONTINUE WITH CONTENT
Never Miss a Beat.
Get our best delivered to your inbox.
Earlier this month, when the House and Senate were preparing to pass their versions of the bill, Eric LeCompte, executive director of the faith-based anti-poverty group Jubilee USA Network, argued that lawmakers should instead "support citizens in developing countries as they work to make sure their leaders are not bribed when they are negotiating the sales of their natural resources."
"Bribes and other illicit transactions," he explained at the time, "including outright theft, by leaders of resource-rich countries perpetuate poverty, fuels conflict and threatens our national security."
As The Hill observed, Tuesday's signing is the first occasion in 16 years "that the Congressional Review Act (CRA) has been used to repeal a regulation, and only the second time in the two decades that act has been law." Resolutions passed to repeal existing rules under the CRA, which has been slammed as "an undemocratic and rarely used backdoor tactic," are not subject to lengthy debate and deliberation.
The Securities and Exchange Commission, which initially wrote the Cardin-Luger rule when it was attached to the 2010 Dodd-Frank Wall Street Reform Act, now has a legislative mandate to write a new regulation."In the short term, we lost a tool that can help track the billions of dollars lost to corruption and tax evasion in the developing world," LeCompte said Tuesday. "Now we need to be sure that the new rule that the Securities and Exchange Commission writes will be a rule that can still stop corruption. Improving financial transparency and ending global poverty are two sides of the same coin."
Ahead of the signing ceremony, supporters of the transparency rule urged Trump not to sign using the hashtag #vetocorruption.
— Laura Rusu (@laura_rusu) February 14, 2017