Chineme Okafor in Abuja
The global Extractive Industries Transparency Initiative (EITI), has said that illicit financial flows, huge financial corrupt practices, terrorism and tax evasion witnessed across the world are been reinforced by secrecy over ownership of oil blocks and other mineral resources.
EITI, explained that the fact that people do not know who truly holds titles to and operate natural resource mining entities in the world, has made it difficult to know who evades taxes, engages in illicit transfer of funds, and other criminal activities.
Also, EITI, in a statement from the Nigeria Extractive Industries Transparency Initiative (NEITI), explained that it was convinced that knowing the real owners of companies that operate in the sector in resource-rich countries especially in Africa could strengthen the practice of natural resource governance.
The EITI identified illicit activities such as corruption, money laundering, tax evasion, and terrorism financing, as part of the dangers of hidden beneficial owners of companies.
The global body explained that public disclosure of real owners of companies mining natural resources would improve investment climate, reduce reputational and financial risks, and prevent illicit financial flows.
“Other gains include improvement in rule of law, promotion of citizens’ engagement, trust and accountability, increased revenue collection as well as creation of level-playing grounds for foreign investments to thrive,” said the EITI in the statement.
It further noted that in resource-rich countries like Nigeria, public disclosure of real owners of companies in the oil, gas and mining sectors could translate to billions of dollars in extractive revenue payments to governments, which could be channeled into initiating programmes for poverty reduction and improved standard of living for citizens.
Discussion at the conference, it added would include emerging best practices in beneficial ownership disclosures in EITI member countries, including Nigeria, while participants will equally examine how to mobilise domestic resources in oil, gas and mining sectors.
It said that other issues for discussion at the conference would be risks management in licensing, issues of politically exposed persons and conflict of interests.
Accordingly, the NEITI has since published a roadmap on beneficial ownership disclosures as part of Nigeria’s commitment to EITI implementation and Open Government Partnership (OGP).
The publication of the roadmap, according to NEITI was in fulfillment of President Muhammadu Buhari’s declaration at the London anti-corruption summit in 2016 that Nigeria would undertake the development of a public register of beneficial owners of companies in the oil, gas and mining sectors.
Similarly, the scope of NEITI independent audit reports has expanded to cover voluntary beneficial ownership disclosures.
NEITI explained that this was in addition to series of multi-stakeholders’ engagements to drive home the message that beneficial ownership disclosures would be part of Nigeria’s extractive sector.