Australian mining companies running in Africa are opposed to political leaders following Canada’s footsteps in bringing anti-corruption and bribery laws into effect
They fear this will make doing business in Africa much more challenging, the AFR reported.
The Canadian government joined Britain last month by introducing legislation that makes facilitation payments illegal. Those caught will face fines and jail time.
Facilitation payments are small amounts paid to access standard government services.
The law in Canada on the payments will affect Australian mining companies running in Africa that are double-listed in Toronto or employ Canadians.
But the Australia-Africa Mining Industry Group (AAMIG) contended facilitation payments are crucial in getting work done in many poor undeveloped African countries and permitting it encourages transparency.
“We would all like to be able to do business in Africa without the need to make facilitation payments but what drives this behaviour is essentially poverty and lack of resources in governments,” AAMIG president Bill Turner said.
“Until the level of economic well-being in these countries lifts as a result of investment, and governments have revenue to do what they should be doing, including paying their employees reasonable salaries, then this behaviour is going to continue.
“To think you can just flick some legislation through somewhere around the world be it Canberra, Ottawa or London, and expect all these things to change is not very realistic.”
Former Attorney-General Nicola Roxon asked for submissions two years ago in a bid to bring in Australia’s first anti-corruption scheme.
Some opine they will eventually be barred from facilitation payments as the government aims to meet the level of other OECD countries.
“Increasingly, companies are listing on foreign exchanges; if they continue that practice [of making facilitation payments], they’re at risk of prosecution from the US or the UK,” Australian co-ordinator of Publish What You Pay Claire Spoors said.
“Long-term, I think facilitation payments will have to be ruled out here as well just so businesses in Australia can have greater investment possibilities.”
The Publish What You Pay coalition recently called on Australian mining giants to make mining payments to governments more transparent.
It asked oil and gas companies based here and listed on the ASX to report all payments to governments in the countries in which they operate.
But a federal judge in the United States rejected a securities rule that asked oil and gas companies to make their payments to foreign companies public.
The judge said Congress did not require companies to make the information public.
Turner said AAMIG had discussions with both sides of federal Parliament and they had been ‘very understanding’.
He believed the government would hold a committee hearing and consult with industry to hear their opinions if it moved forward on the issue.
It is not yet known when the ban on facilitation payments will be implemented in Canada. The Canadian government said it will allow companies a ‘grace period’ to let them review their anti-corruption guidelines.