Jurisdiction - Australia
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Australia – Bill To Introduce Mandatory Reporting Of Payments By Extractive Companies To Governments.

9 December, 2014


Legal News & Analysis – Asia Pacific – Australia – Energy & Project Finance


Corporations Amendment (Publish What You Pay) Bill 2014

What You Need To Know


  • Senator Milne (the leader of the Australian Greens) has introduced a Bill into the Senate which, if passed, would require Australian resource extraction companies to report payments over AUD 100k to Australian and foreign governments.
  • The Explanatory Memorandum indicates that the aim of the Bill is to improve transparency and accountability and to deter corruption. The Bill seeks to bring Australia in-line with international developments, including in the United Kingdom, the United States of America and Canada.
  • Without the support of the Federal Government, the Bill will not become law. That support has not been indicated to date.


On 28 October 2014, Senator Milne, leader of the Australian Greens, introduced the Corporations Amendment (Publish What You Pay) Bill 2014 (Bill) into the Senate. The Bill, if passed, would require Australian public and large proprietary companies who are involved in extractive industries (such as oil, gas, mining and native forest logging) to disclose any payments made to Australian and foreign governments over AUD 100k. The Explanatory Memorandum states that the aim of the Bill is to improve transparency and accountability of Australian extractive companies, deter corruption and bring Australia in-line with international standards.

Without the support of the Federal Government, it is unlikely that the Bill will gain sufficient backing in Federal Parliament to become law in Australia. However, given the shift towards mandatory reporting to improve transparency in the United Kingdom, Canada, the United States of America and across the European Union, there may be increased pressure to introduce similar “publish what you pay” reporting laws for resource extraction companies in the future.

International Developments

United Kingdom And The European Union

The Reports on Payments to Governments Regulations 2014 (UK Regulations), which came into force on 1 December 2014, implement Chapter 10 of the EU Accounting Directive (2013/34/EU), which seeks to bring greater transparency to extractive companies registered in EU Member States. The UK Regulations apply to publicly listed and large companies who are registered in the UK and who are active in the extractive (mining or quarrying) or primary logging industries. They require disclosure of a range of payments (including taxes, royalties and bonuses) made to governments if the payment (or a series of payments) exceeds GBP 86k. Disclosure under the UK Regulations is generally required in relation to financial years beginning on or after 1 January 2015.

The UK Financial Conduct Authority is also preparing amendments to the Disclosure and Transparency Rules which will require foreign extractive companies who are publicly listed on UK-regulated securities markets (chiefly the London Stock Exchange) to make the same disclosures. It is anticipated that these rules will apply by 1 January 2015. These rules will implement the amending directive (2013/50/EU) to the EU Transparency Directive (2004/109/EC), which imposes equivalent reporting requirements on companies active in extractive industries with securities admitted to trading on EU regulated markets even if they are not registered in the European Economic Area.


Canada is currently introducing mandatory disclosure rules, which are similar to the UK Regulations described above. The Canadian Government hopes that the Extractive Sector Transparency Measures Act, which requires extractive companies to disclose payments made to government entities, will be in force by 1 April 2015. The threshold amount for reporting purposes in the tabled rules is CAD 100k. This move by the Canadian Government fulfils a pledge by Prime Minister Harper in June 2013 to adopt mandatory disclosure rules, as an initiative arising out of the 2013 G8 Summit.

United States Of America

Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act imposes similar reporting requirements on US and foreign resource extraction companies who report to the US Securities Exchange Commission (SEC). However, these provisions are not yet in force because the SEC rule which implemented these disclosure requirements was vacated by the US District Court for the District of Columbia in July 2013 on administrative grounds. It is expected that the SEC will reissue these rules by March 2015.

Australian Reform – The Australian Greens’ Proposal

To Whom Would The Disclosure Requirements Apply?

The Bill, which was introduced by the Australian Greens into the Senate on 28 October 2014, seeks to impose “publish what you pay” disclosure requirements on Australian public companies and large proprietary companies (the reporting companies) who:


  • engage in one or more “resource extraction activities” anywhere in the world; or
  • are a holding company of a body corporate that engages in these activities, whether or not this subsidiary is incorporated in Australia.

“Resource extraction activities” include:


  • exploration, prospecting, discovery, development or extraction activities in relation to minerals, oil, natural gas or similar materials; or
  • logging of certain “primary forests”.

According to the Explanatory Memorandum, the Bill’s definitions of “resource extraction activities”, and “primary forests” reflect the wording of EU Accounting Directive (2013/34/EU).

What Payments Would Need To Be Disclosed?

The Bill proposes that a “publish what you pay report” disclose all payments (including payments in kind) which are made by a reporting company or any subsidiary to a “government entity” that is over AUD 100k. These payments must relate to a resource extraction activity in respect of any of the following:


  • production entitlements;
  • taxes levied on the income, production or profits of a company;
  • royalties or dividends;
  • signature, discovery or production bonuses;
  • licence fees, rental fees, entry fees or other consideration for licences or concessions;
  • infrastructure improvements (including roads, dams and bridges);
  • social welfare payments or community projects; and
  • security services.

Under the Bill, the disclosure would extend to payments made to “government entities” including:


  • the Commonwealth government of Australia or State and Territory governments;
  • the government of a foreign country or part of that country; and
  • a government authority or company owned by any of these governments (in other words, the reporting must address payments made to foreign state owned enterprises).

The disclosure requirements would apply to single payments exceeding AUD 100k, and to a series of related payments which exceed AUD 100k. Payments would be disclosed on a country-by-country and project-by-project basis.

Where Would The Disclosures Be Made?

Under the Bill, reporting companies must include a “publish what you pay report” in their financial statements. The report is subject to the same requirements that apply to the financial statements and financial reports in general, including the audit provisions.
ASIC must publish these reports in open and machine readable form on its website as soon as reasonably practicable (and within 28 days after receipt).

What Next?

The Bill has not progressed since Senator Milne delivered the second reading speech on 28 October 2014. The Senate Selection of Bills Committee has deferred considering the Bill until its next meeting. The current Federal government has not commented on the Bill and it appears unlikely that it will support the Australian Greens in its attempt to pass it.


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Lisa d’Oliveyra, Ashurst
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Georgina Molloy, Ashurst
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