1. BENEFICIAL OWNERSHIP AND THE USE OF GIS DATA Ara Lou Margaret Aguilar

2. Outline I.What is beneficial ownership? II.What information are contained in the General Information Sheet (GIS)? General Information Sheet (GIS) III.What information are contained in a Financial Statement? IV.WON the GIS discloses beneficial ownership

3. V. WON the EITI Report discloses beneficial ownership VI. Discussion Unveiling the ‘masters’ Government Role CSO Roles Challenges VII. Exercises Fill out Beneficial Ownership Declaration

4. As of January 2015, the following documents have been made publicly available : oDisclosure of contracts of companies; oDisclosure of auxiliary rights granted to extractive companies operating in the Philippines; oGIS and Statement of Income and Expenditures of SEC registered companies; oDisclosure of agreements between companies and Indigenous Peoples Communities; and oMonitoring reports of the Department of Environment and Natural Resources. These documents can be downloaded from Open Data Philippines (http://data.gov.ph)http://data.gov.ph

5. I. What is Beneficial Ownership? It is a legal term where specific property rights (“use and title”) in equity belong to a person even though legal title of the property belongs to another In relation to the Extractive Industries Transparency Initiative (EITI), it describes the natural person(s) who, directly or indirectly, ultimately own(s) or control(s) a corporate entity, a license or other property

6. – Definition of beneficial ownership: i.A beneficial owner in respect of a company means the natural person(s) who directly or indirectly ultimately owns or controls the corporate entity. ii.Where the multi-stakeholder group addresses beneficial ownership, the multi-stakeholder group should agree an appropriate definition of the term beneficial owner. The definition should be aligned with 3.11(d)(i) above and take international norms and relevant national laws into account.multi-stakeholder group

7. iii.Publicly listed companies, including wholly-owned subsidiaries, are not required to disclose information on their beneficial owner(s). iv.In the case of joint ventures, each entity within the venture should disclose its beneficial owner(s), unless it is publicly listed or is a wholly-owned subsidiary as per 3.11(d)(iii). Each entity is responsible for the accuracy of the information provided.

8. Importance 1. EITI core component Transparency : Payments disclosed by companies and receipts disclosed by governments are reconciled by an independent administrator and published in an annual EITI report. Accountability: A multi-stakeholder group composed of representatives from government, companies and civil society oversees the EITI implementation and sees to it that the reports produced are comprehensive.

9. Importance 2. Check against corruption Complex corporate structures and partnerships can disguise who bids for the right to explore and extract natural resources, leaving a huge loophole where corruption and abuse can thrive.

10. Requirement 3.11 of the EITI Standard sets out the provisions related to beneficial ownership: – It is recommended that implementing countries maintain a publicly available register of the beneficial owners of the corporate entity(ies) that bid for, operate invest in extractive assets, including the identity(ies) of their beneficial owner(s) and the level of ownership. Where this information is already publicly available, e.g. through filing to corporate regulators and stock exchanges, the EITI Report should include guidance on how to access this information.EITI Report

11. – Where such registers do not exist or are incomplete, it is recommended that implementing countries request companies participating in the EITI process provide this information for inclusion in the EITI Report. – It is required that the government and/or state- owned enterprises disclose their level of beneficial ownership in oil, gas and mining companies operating within the country, and any changes in the level of ownership during the accounting period covered by the EITI Report (Requirement 3.6(c)).

12. Standards Global Witness recommends that for each natural resource company that bids for, operates and invests in extractive assets, the following information should be made available: Name of beneficial owner. The full name(s) of its beneficial owner(s). Name of any political exposed person.

13. Standards Contact Means of control Signed statement of accuracy

15. II. What information are contained in the General Information Sheet (GIS) The GIS contains the following pertinent information, among others: – Corporate name – Office address – Primary purpose/industry presently engaged in – Investments – Unrestricted retained earnings

16. – Stockholders’ information Name Nationality Current address Number, type, amount of shares subscribed Percent of ownership Amount of shares paid

17. – Directors’/Officers’ Information Name Nationality Current Address – Sample GIS: Globe Telecom 2010 Sample GIS: Globe Telecom 2010

18. III. What information are contained in the FINANCIAL STATEMENT (FS)? 1.Barcode page 1.Cover sheet: Contact details, # of stockholders, amended articles, borrowings

19. 3. Statement of Management Responsibility Company is responsible for the preparation and presentation of the financial statement in accordance with the prescribed financial framework Fair presentation Free from material misstatement due to fraud or negligence Reviewed and approved by board Independent accounting firm hired to examine fs in accordance with the Philippine Standards on Auditing, signed by the President and Treasurer Signed by the CEO/President and Treasurer/Chief Finance Officer/Finance Manager

20. 4. Independent Auditor’s Report -Signed by senior partner with contact information of the auditing firm 5. Statement of Representation 6. Comparative statement of Financial Position -Current and non-current assets, current and non- current liabilities -Statement of Income

21. 7. Comparative statement of Change in Capital Deficiency 8. Comparative statement of Cash flow -Income from financing -Income from investing -Cash in the beginning vs cash in the end of the year

22. 9. Notes to Financial Statement -Company info -Basis of preparation, statement of compliance -Summary of Significant Accounting Policies etc 10. Supplemental Written Statement of Independent Auditors SAMPLE FS: Aam Phil Natural

23. IV. Does the GIS disclose beneficial ownership? No. The data presented are insufficient. Complex structure of corporations

24. V. Does the EITI report disclose beneficial ownership? No, not yet. Pilot testing still going on. -> To assess the feasibility of requiring beneficial ownership disclosure through the EITI, including reviewing existing disclosure practices and identifying suitable approaches for disclosure. Expected outputs from the pilot include (i) a report on lessons learned; (ii) a guidance note on approaches for beneficial ownership disclosure through the EITI; and (iii) a widely applicable agreed procedure for reporting on beneficial ownership.

25. Countries in the piloting testing” Burkina Faso, the Democratic Republic of Congo, Honduras, Iraq, Kyrgyz Republic, Liberia, Niger, Nigeria, Tajikistan, Tanzania, Trinidad & Tobago and Zambia

26. Timeline for Pilot Testing

27. Model Country: Norway Entered the names of each reporting company in Norway's company register, which yielded the corporate identifier – or example, BayernGas Norge AS is 989490168 in the system. Entered these identifiers in a corporate database - http://www.purehelp.no/ which contains details of shareholders of the companies. Took the names of these parent companies and searched on OpenCorporates, Dun and Bradstreet and other resources to find their nationality. The resulting raw data is available in Annex 1 – EITI reporting companies and their parents. All this data would be produced by the EITI process itself in the 38 implementing countries if this standard was adopted.

28. Sample Table of Stockholders’ Nationalities

29. VI. Discussion Unveiling the ‘masters’ Government Role CSO Roles Challenges VII. Exercises Fill out Beneficial Ownership Declaration

30. BENEFICIAL OWNERSHIP AND THE USE OF GIS DATA Thank you.