Majority of Republicans on House Committee Vote to Overturn Landmark Cardin-Lugar Anti-Corruption Provision

Washington, DC — Today’s vote by the majority of Republicans on the U.S. House Financial Services Committee to overturn a bipartisan transparency law is a major setback for combating corruption and a gift to big oil companies. The news comes after months of astonishing roll backs from the Trump Administration and Republican-controlled Congress to abdicate U.S. leadership on global transparency.

“These attacks on vital transparency provisions are a big giveaway to ExxonMobil and Chevron, as well as despots across the globe,” said Corinna Gilfillan, Head of Global Witness’ U.S. Office. “The U.S. has thrown away its global leadership on tackling corruption.”

The bipartisan law,¹ known as the Cardin-Lugar anti-corruption provision, requires U.S.-listed extractive companies, including ExxonMobil, Chevron and several Chinese oil majors, to publish details of the hundreds of billions of dollars they pay to governments across the world in return for rights to natural resources. OECD analysis² indicates the extractives industry is the most corrupt in the world: bringing shady oil deals to light is a vital way of ensuring these vast public revenues benefit local communities in resource-rich countries, instead of lining the pockets of corrupt elites.

However, today Republican members of the Committee, with the exception of Representative Royce (R-CA-39) who stood up for transparency, voted to rescind this law in favor of allowing deals to be made behind closed doors. These transparency provisions are essential if we are to shed light on deals such as ExxonMobil’s renewal of three lucrative oil licenses in Nigeria, currently the subject of a high-level corruption investigation.³

In February, the Republican controlled Congress voted to overturn the 1504 rule implementing the Cardin-Lugar provision. The vote in the senate came just two days after Rex Tillerson was confirmed as Secretary of State by the Senate. Tillerson had lobbied against the law while CEO of ExxonMobil.

This grave news of another attack on this law is just the latest move from the Trump Administration and Congress, backed by the American Petroleum Institute, to undermine the U.S.’ long-standing bipartisan commitment to transparency and anti-corruption efforts. In November, the U.S. Department of Interior announced that the U.S. would withdraw from implementing the Extractive Industries Transparency Initiative (EITI), a multi-stakeholder global anti-corruption program for the oil, gas and mining sectors.  The move was a result of the insistence of major U.S. oil companies ExxonMobil and Chevron on keeping their U.S. tax payments secret.

“Oil, gas and mining companies from other countries have already disclosed over $150 billion in payments under mandatory transparency rules,” said Gilfillan. “If they can do it, you have to ask – what are the U.S. companies trying to hide?”

All of these moves set the U.S. in opposition against a broader global trend toward greater transparency and accountability in how oil, gas and mining revenues are managed. Thirty other major economies around the world, including Canada, Norway, the UK and the other 27 members of the European Union, have laws requiring their oil, gas and mining companies to disclose their payments to governments. Dozens of major European, Russian and Chinese oil companies have already published their payments to governments.

Claims made by the oil lobby that greater transparency will harm U.S. oil companies’ competitiveness have proven untrue. In fact, research concludes that increased transparency resulting from the disclosures required by the Cardin-Lugar anti-corruption provision could​ ​lower​ ​the​ ​cost​ ​of​ ​capital​ ​for​ ​covered​ ​companies​ ​by between $6.3 billion and ​$12.6​ ​billion.⁴