By Aruna Viswanatha
ReutersÂ
WASHINGTON — The U.S. Securities and Exchange Commission defended its new rule requiring oil, mining and gas companies to disclose payments they make to foreign governments, saying it declined to “second-guess” policy decisions made by Congress.
The agency on Wednesday responded to a lawsuit filed in October by four business groups challenging the new rule, which was mandated by the 2010 Dodd-Frank financial regulation overhaul Groups including the U.S. Chamber of Commerce and the American Petroleum Institute have argued the rule went beyond the intent of Congress and puts U.S. firms at a competitive disadvantage.
In a brief filed in a Washington federal appeals court, the SEC said the legislative history of the law made clear the provision was crafted by Congress to address the “resource curse,” or the phenomenon of resource riches leading to corruption in poor countries.