Extractive Industries Transparency Initiative (EITI)

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EITI Compliance

Countries seeking to achieve EITI Candidate status must meet five sign-up requirements, and for a country to achieve EITI Compliance, it has two and a half years to be validated as a Compliant country. Once a country is Compliant, the country must undergo Validation at least every 5 years, or upon the request from the EITI International Board.[1]

As of January 2013 18 countries were "EITI compliant", namely: Azerbaijan, Ghana, Iraq, Kyrgyz Republic, Mauritania, Mozambique, Nigeria, Peru, Timor-Leste, Zambia, Central African Republic, Liberia, Mali, Mongolia, Niger, Norway, Tanzania and Yemen. There were a further 18 "Candidate Countries": Afghanistan, Cameroon, Chad, the Democratice Republic of Congo, Guineau, Sao Tome and Principe, the Solomon Islands, Trinidad and Tobago, Albania, Burkhina Faso, Cote d'Ivoire, Gabon, Guatemala, Indonesia, Kazakhstan, Congo, Sierra Leone and Togo. Madagascar was temporarily suspended at the time.[2]

Validation Requirements

Sign-Up

The EITI rules state that a country applying for Candidate status must meet the following sign-up requirements:

1. The government is required to issue an unequivocal public statement of its intention to implement the EITI.

2. The government is required to commit to work with civil society and companies on the implementation of the EITI.

3. The government is required to appoint a senior individual to lead on the implementation of the EITI.

4. The government is required to establish a multi-stakeholder group to oversee the implementation of the EITI.

5. The multi-stakeholder group, in consultation with key EITI stakeholders, should agree and publish a fully costed work plan, containing measurable targets, and a timetable for implementation and incorporating an assessment of capacity constraints.[3]

Preparation

The government is required to: ensure the engagement of civil society in the process; engage companies; and remove legal and regulatory obstacles to the implementation of the EITI. The multi-stakeholder group is required to agree a definition of materiality and the reporting templates, which define what revenue streams are included in company and government disclosures. The organisation appointed to produce the EITI reconciliation report must be perceived as credible, trustworthy and technically competent. The government is then required to ensure that all relevant companies and government entities report and that both company and government reports are based on accounts audited to international standards.[4]

Disclosure

Companies must comprehensively disclose all material payments in accordance with the agreed reporting templates, and government agencies must comprehensively disclose all material revenues. The multi-stakeholder group must also be content that the organisation contracted to reconcile the company and government figures did so satisfactorily, and the reconciler must ensure that that the EITI Report is comprehensive, identifies all discrepancies, where possible explains those discrepancies, and where necessary makes recommendations for remedial actions to be taken.[5]

Dissemination

The government and multi-stakeholder group must ensure that the EITI Report is comprehensible and publicly accessible to encourage that its findings contribute to public debate.[6]

Review and Validation

Oil, gas and mining companies must support EITI implementation, and the government and multi-stakeholder group are encouraged to take steps to act on lessons learned, address discrepancies and ensure that EITI implementation is sustainable. Implementing countries are required to submit Validation reports in accordance with the deadlines established by the Board.[7]

Retaining Compliant Status

Compliant countries must maintain adherence to all the requirements listed above in order to retain Compliant status.[8]

EITI Criteria

1. Publication: Regular publication of all material oil, gas and mining payments by companies to governments (“payments”) and all material revenues received by governments from oil, gas and mining companies (“revenues”) to a wide audience in a publicly accessible, comprehensive and comprehensible manner.

2. Audit: Where such audits do not already exist, payments and revenues are the subject of a credible, independent audit, applying international auditing standards.

3. Reconciliation: Payments and revenues are reconciled by a credible, independent administrator, applying international auditing standards and with publication of the administrator’s opinion regarding that reconciliation including discrepancies, should any be identified.

4. Scope: This approach is extended to all companies including state-owned enterprises.

5. Civil Society: Civil society is actively engaged as a participant in the design, monitoring and evaluation of this process and contributes towards public debate.

6. Work Plan: A public, financially sustainable work plan for all the above is developed by the host government, with assistance from the international financial institutions where required, including measurable targets, a timetable for implementation, and an assessment of potential capacity constraints.[9]

EITI Implementation by country

Iraq

Main article: EITI in Iraq

Niger

Main article: EITI in Niger

Tanzania

Main article: EITI in Tanzania

External Links

Official Website: www.eiti.org

References

  1. "EITI Implementation" EITI, retrieved 27 October 2011.
  2. "EITI Countries" EITI, retrieved 15 January 2013.
  3. "Sign Up" EITI, retrieved 27 October 2011.
  4. "EITI Rules" EITI, retrieved 27 October 2011.
  5. "EITI Rules" EITI, retrieved 27 October 2011.
  6. "EITI Rules" EITI website Retrieved 27 October 2011.
  7. "EITI Rules" EITI, retrieved 27 October 2011.
  8. "EITI Rules" EITI, retrieved 27 October 2011.
  9. "EITI Rules" EITI, retrieved 27 October 2011.