Global Investors for Financial Transparency

Good morning, ladies and gentlemen!

It`s nice to see such a competent audience. Nice to see that the organizers has managed to bring together representatives from civil society, investors and from authorities in the EU and the US here in Bjørvika, Oslo.

The topic for this meeting is certainly of relevance for politicians, regulators, representatives of the capital markets and others. I would therefore like to praise KLP and PWYP for organising this dialogue meeting.

Part I of today´s meeting will focus on the status of financial reporting in the extractive industries in the US and the EU. As the initiatives regarding country by country reporting (CBC) could have a significant impact on the future Norwegian requirements, it will be of interest to receive detailed information on the current development . In part II, invitees will discuss possible implementation in Norway. The Ministry of Finance is looking forward to receiving input on this issue. Deputy director, Alexander Behringer will represent the Ministry in the roundtable discussion in part II. The last legal report commissioned by PWYP and written by Arntzen de Besche, has the Ministry sent on a hearing in the norwegian Financial Supervisory Authority.

The United States has passed legislation which will oblige listed oil and gas companies as well as mining companies to report country specific data. The US Securities Exchange Commission (SEC) is currently preparing more detailed requirements. Expected entry into force of the rules is in 2012. In Europe, the European Commission will outline its policy on CBC in the EU in a Communication in September. Both the US and the EU initiatives are of interest for Norway. The future US requirements will apply to Statoil, which is listed at the New York Stock Exchange.  A future EU legislation would be of particular relevance more generally, as such a legislative act proably will be of EEA relevance. Accordingly, Norway will be obliged to implement rules in accordance with the EU requirements.

Norway is a large exporter of oil and gas and also a large investor through the Government Pension Fund. Norway has supported measures that could increase transparency in the extractive industries. For instance, Norway has implemented the Extractive Industry Transparency Initiative (EITI) as the first OECD country.  And Norway is prepared to continue to be in the forefront. The Norwegian government is positive to rules that could increase transparency regarding money flows from multinational companies to foreign governments.  By requiring multinational companies to break down their accounts to the countries where they operate, the civil society could more effectively hold governments accountable and thereby make sure that the entire population will profit from revenues. Transparency with regard to money flows could also have impact as an anti-corruption measure and could help tackle tax avoidance. Not least for developing countries, but also for tax authorities in more advanced economies, we hope that CBC can be a useful instrument. Consequently, we support the concept of CBC reporting.

However, it is important that such reporting requirements are on an international level; this is a precondition for effective implementation, and  would also ensure a level playing field for the companies concerned. In fact, the benefits will be greater and the cost will be lower, the more countries that implement cbc-reporting. Therefore, we favour common EU rules in this area. However, taking into account the importance of this issue we can not rule out the possibility to implement such measures in Norway on an individual basis. Accordingly, in the Norwegian government´s action plan against economic crime, which was adopted in March this year, the government states that it is open to consider implementation of such rules in Norway, either in relation to potential future EU legislation or on an individual basis.

I note that the EU Internal market Commissioner Michel Barnier has stated that the Commission will look closely at the competitive position of Europe-based companies and will measure the costs that this policy would impose before making the final decisions. Furthermore, I have noted that several EU member states are reluctant to introduce CBC reporting requirements on an EU level, but favour international rules. International rules, ensuring a level playing field also beyond the EU should of course be encouraged. However, as we often see, someone needs to take the first steps, and I believe that in the long term, an outcome of the EU assessment which follows up the US initiative, will be favourable also for EU stakeholders. Therefore, we are looking forward to the Commission Communication early autumn, and we look forward to the discussion here today. Again, many thanks to PWYP and KLP for organising this event. I hope it will be a fruitful step towards our common goal: Transparency, development and fair distribution of economic gains.