Judge throws out SEC’s disclosure rule for energy companies

The energy industry scored a big win Tuesday when a federal judge tossed out a Securities and Exchange Commission rule that required oil and mining companies to disclose payments to foreign governments.

Deeming the regulation arbitrary and capricious, U.S. District Judge John Bates in Washington noted that the SEC failed to include exemptions in cases in which foreign governments explicitly ban public disclosures, according to Fuel Fix, a website reporting the industry.

The regulation was issued under the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010, intended to bring financial reforms following the Great Recession. The disclosure rule applies to about 1,100 public energy companies involved in gas, oil and minerals, Bloomberg News said, and is intended to improve transparency for citizens of countries with natural resources.

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Adopted last August, the SEC rule required the companies to report payments to other nations that are north of $100,000 and are intended to “future the commercial development� of resources in those countries.

But the American Petroleum Institute, the U.S. Chamber of Commerce and two trade groups challenged the rule in court, arguing that it hindered U.S. companies trying to compete in a global market.

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