SEC Transparency Rule Would Assist Foreign Oil Companies
For decades, the United States has been the gold standard when it comes to transparency and high disclosure standards. Because of this, investors from around the world have flocked to our economy and our markets. Today, our regulators and policymakers should continue to promote this level of transparency but must also recognize they walk a fine line. Excessive measures can sometimes weaken the competitive nature of American businesses they were intended to help.
Take for example a newly proposed rule from the Securities and Exchange Commission (SEC) that initially sounds like a smart idea due to its calls for increased disclosure. However, upon closer scrutiny, it’s clear this policy would give a leg-up to some of the largest foreign oil companies. The SEC’s proposed regulation, with the backing of President Obama and his friends in Congress, specifically targets the American energy sector.
The regulation would mandate that U.S. SEC-listed companies working in fossil resources provide more detailed financial information than ever before with regard to international payments. The disclosure required would be so detailed that it would even pertain to single, individual wells.
Unfortunately, this type of regulation would provide foreign competitors, including nationalized energy companies such as Venezuela’s CITGO and China’s CNOOC, with too close a view into the inner workings of American energy firms. And, of course, these foreign oil companies are in no way obligated to share their own payment records.
At the end of the day, all this disclosure information can offer is a distinct advantage to foreign oil companies vying for the same resources as U.S. businesses. As we all know, in the modern business environment, information is vital; particularly when that information is about your competition’s projects and finances.
Our country faces the greatest economic challenge since the Great Depression; our unemployment rate has hardly budged in months and people are deeply concerned about America’s role as the engine of the world economy. All of this is happening as President Obama continues to pay lip service to job growth and enhancements to our energy-security apparatus.
On the energy front, President Obama has done everything in his power to move our country in the wrong direction; this includes his support for burdensome regulations on our domestic energy industry. From his decision to halt construction of the Keystone XL pipeline, to the onslaught of new energy taxes, this administration’s anti-energy positions are well documented.
Our regulators and politicians should be focused on fostering a fair playing field and continued economic growth, not an agenda that handicaps American companies. The U.S. energy industry supports millions of American jobs and is trying to provide the resources necessary for America’s economic revival. However, this is getting harder to do each day when our government is assisting our foreign competitors instead of our own industries.