June 30, 2010
The Dodd-Frank Act’s “Needle in the Haystack”: Resource Extraction Disclosure
Now that we are all wading through the 2,000 pages of the Dodd-Frank Act (here is a Subtitle E excerpt if you just want to read the 23 pages related to governance and executive compensation – with exceptions that Sections 971 (proxy access) and 972 (Chair-CEO split) are in Subtitle G), members are finding some items they didn’t expect. For example, Rick Hansen of Chevron notes:
Evidently, late in the conference proceedings, Senator Lugar was successful in having language inserted into the bill regarding disclosure of payments by resource extraction issuers to the Federal Government and foreign governments.
Tucked in the back of the bill in “miscellaneous provisions,” Section 1504 amends Section 13 of the ’34 Exchange Act and requires that the SEC issue final rules that “require each resource extraction issuer to include in an annual report of the resource extraction issuer information relating to any payment made by the resource extraction issuer, a subsidiary of the resource extraction issuer, or an entity under the control of the resource extraction issuer to a foreign government or the [U.S.] Federal Government for the purpose of the commercial development of oil, natural gas, or minerals, including: (i) the type and total amount of such payments made for each project of the resource extraction issuer relating to the commercial development of oil, natural gas, or minerals; and (ii) the type and total amount of such payments made to each government.”
The Act defines “commercial development of oil, natural gas, or minerals” to include “exploration, extraction, processing, export, and other significant actions relating to oil, natural gas, or minerals, or the acquisition of a license for any such activity, as determined by the ]SEC].”
The Act defines “payment” as any payment that is “made to further the commercial development of oil, natural gas, or minerals; and is not de minimis” and includes “taxes, royalties, fees (including license fees), production entitlements, bonuses, and other material benefits, that the Commission, consistent with the guidelines of the Extractive Industries Transparency Initiative (to the extent practicable) determines are part of the commonly recognized revenue stream for the commercial development of oil, natural gas or minerals.”
If you find any other gems, send them along. And if you get a moment, take our new “Quick Survey on Director Education & Orientation.”
Meanwhile, the House-Senate conferee gang got together yesterday to eliminate a special bank “tax” assessment from the bill it passed last Friday in an effort to win support from some key Senators in the wake of Senator Byrd’s death.
Mailed: May-June Issue of The Corporate Counsel
The May-June issue of The Corporate Counsel was just sent to the printers and includes pieces on:
– Why the Media Often Doesn’t Seem to Know Compensation Numbers Until the Annual Proxy Statement is Filed– Are Form 8-K Item 5.02(e) Practices the Culprit?
– Reg FD for Directors: A Good Time to Revisit Your FD Policy
– Addressing an FD Violation–Does “Call the Staff” Go On the Checklist?
– The Asset-Backed Securities Offerings Proposing Release– Implications Generally for 1933 Act Metaphysics (and Plumbing)?
– Other Private Placement Developments
– Client-Directed Voting–An Available Strategy to Increase Retail Voting in Director Elections?
– A Few 2010 Shareholder Proposal Season Post-Mortems
– The Staff’s Response to the New Compensation Risk (Non-)Disclosure
– Pilot Staff Review of Rule 424 Filings
– Going Concern Qualifications–Nasdaq Acknowledges that SEC Filing is Sufficient Announcement
– Credit Agreements–Exhibit Filing of Schedules and Attachments
– How to Gear Up for Mandatory Say-on-Pay
Act Now: Get this issue on a complimentary basis when you try a “Rest of ’10 for Half-Price” no-risk trial today.
Second Circuit Finally Delivers an Opinion on PSLRA’s Forward-Looking Information Safe Harbor
Recently, the Second Circuit issued its first opinion analyzing the PSLRA’s safe harbor for forward-looking statements in Slayton v. American Express, 15 years after the safe harbor was created. We are posting memos analyzing the opinion in our “Forward-Looking Information” Practice Area.
– Broc Romanek