On April 16, 2012, the FT
reported a possible conflict of interest / bribery between 3 powerful
Angolan officials and the American company Cobald International
Energy. As a matter of fact, the Angolan officials are blamed for
holding unconcealed interests in a Cobald venture in Angola.
Besides mandatory
American anti-corruption regulation, this case involves the voluntary
code that has been developed by the Extractive Industries
Transparency Initiative.
The Extractive
Industries Transparency Initiative (EITI)
The EITI is a non-profit
association set up under Norwegian law. Its members are
- Governments
- Oil, gas, and mining companies
- Investors such as asset management companies and pension funds
- Non-governmental organizations
As you may expect, every
member of the association engages to support the objective of the
EITI. As a matter of fact, a membership can be canceled if the member
in question has conducted his affairs in a way considered prejudicial
or contrary to the EITI Principles.
The major goals of the
EITI are threefold:
- Develop internationally accepted standards for transparency in the oil, gas, and mining sectors
- Reduce corruption
- Ensure that the standard of living of the population in resource-rich countries is ameliorated through the revenues from extractive industries
EITI is funded by
contributions from its members and, in addition, by grants from
bilateral and multilateral donors.
The EITI Rules
First and foremost,
strictly, speaking, the EITI Rules are not enforceable by themselves.
The only concrete sanction that is provided for in the EITI articles
of association is a possible exclusion of a member in case he
violates his obligations embedded in the EITI Rules. However, states
(especially those who are members of the EITI) may adopt the EITI
Rules and transfer them into national law making it, thereby, legally
binding.
The EITI Rules consist of
5 parts:
- Principles
- Criteria
- Requirements for EITI implementing countries
Such requirements specify
the above principles and criteria. They describe, in a very detailed
way, which actions governments of EITI member countries should take
to be EITI compliant.
- Validation Guide
The validation process
assesses whether the above EITI requirements have been met. Its
purpose is twofold: Promote a dialogue and learning at the country
level and safeguard the EITI brand by holding all EITI implementing
countries to the same global standard.
- Policy Notes
Policy notes are issued
by the EITI boards. Their goal is to strengthen the quality,
consistency and sustainability of the validation process.
Resources:
- FT “Unclear as oil” dated April 16, 2012
- EITI Articles of Association
- EITI 2011 Rules
