Trust between Government and Investors is Impossible without Transparency - Experts

17 October 2016

On 17 October, DiXi Group think tank initiated a round table to discuss the draft law "On Disclosure of Information in Extractive Industries" (registration No. 4840).

The aim of the discussion was to present the most progressive provisions of the draft law, its capacities in the context of the subsoil use reform and disclosure of data on beneficiary owners, setting of conditions for financial transparency and effective development of natural resources.

During the round table, the participants discussed the role of companies' transparency in reforms of the extractive sector and attraction of investments, special features of reporting by the respective agencies and companies as well as prospects of implementation of the draft law .

The invited participants of the round table were members of specialized committees of the Verkhovna Rada, representatives of the key energy companies, public organizations, experts as well as high-ranking officials professionally interested in this topic.

Member of parliament, one of the authors of draft law No. 4840, Olga Bielkova emphasized: "The gas extraction sector is defined as a priority area for investing. However, essential investments from the field-specific investors will only come if we have clear, long-term rules of the game, and higher transparency. Implementation of the standard of the Extractive Industries Transparency Initiative as such in other countries already have resulted in involvement of 1-2 new companies a year. We propose the rules that will present an honest business portrait of the industry and will revive credibility of Ukraine".

The legislators also paid attention to Ukraine's compliance with the EITI standard and the EU legislation. "In the area of natural resources extraction, not a fake but real transparency is needed – in compliance with the best international standards. The rules of disclosure of detailed information on the subsoil use are applied not only in the EU countries, but also in the USA, Canada, and Australia. The completeness of data enables the government to make reasonable, balanced decisions", said member of parliament, Secretary of the Parliamentary committee on Environmental Policy Ostap Yednak.

At the same time, the representatives of public organizations paid attention to the advantages of information disclosure for local communities on the territory of which exploration and extraction of natural resources take place. "Draft law No. 4840 expands the list of information that has to be publicly available. In particular, the data on taxes and payments of companies are detailed on the level of projects, that is specific sites or groups of fields. Communities will see at last the verified information on payments to local budgets, social investments, fulfillment of environmental requirements, and employment", DiXi Program Manager Roman Nitsovych said.

On the eve of the round table, a public pressure campaign that was initiated by DiXi Group was launched in social networks. To attract attention, the think tank experts developed posters illustrating specific provisions of draft law No. 4840.

It should be recalled that DiXi Group experts have repeatedly initiated introduction of a new reporting regime based on the best world practices – EITI standard and the EU Directives.

The event was organized with the support of the EITI National Secretariat and the International Renaissance Foundation.

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