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Germany

Financial Transparency - EITI Standard (DE0005)

Overview

At-a-Glance

Action Plan: Not Attached

Action Plan Cycle: 2017

Status: Inactive

Institutions

Lead Institution: Federal Ministry for Economic Affairs and Energy (BMWi)

Support Institution(s): D-EITI secretariat; Federal Ministry of Finance; Federal Ministry for Economic Cooperation and Development; Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety; state ministries of finance and economic affairs; state mining authorities; local associations; stakeholders of the extractive industry in Germany, including from the private sector (e.g. Federation of German Industries (BDI), Association of German Chambers of Commerce and Industry (DIHK) and civil society (e.g. Transparency International, Open Knowledge Foundation), who are represented in the MSG

Policy Areas

E-Government, Environment and Climate, Extractive Industries, Fiscal Transparency, Legislation & Regulation, Open Data, Private Sector

IRM Review

IRM Report: Germany Design Report 2017-2019

Starred: Pending IRM Review

Early Results: Pending IRM Review

Design i

Verifiable: Yes

Relevant to OGP Values: Access to Information Civic Participation , Technology

Potential Impact:

Implementation i

Completion:

Description

Description: To meet the standard of the international Extractive Industries Transparency Initiative (EITI) in Germany, we are working with a multi-stakeholder group (MSG) composed of the ministries concerned, the federal states, municipalities, civil society and businesses. The progress of national efforts (D-EITI) will be tracked in particular in an annual report which compares payments by extractive enterprises with the corresponding revenues of government agencies. Moreover, the DEITI report will include comprehensive and understandable explanations on Germany’s extractive industries (e.g. legal framework, extracted resources, system of taxes and duties, and data on production and export) and address several special issues (e.g. intervention regulation under nature conservation law, renewable energy resources, etc.). In addition, information about mining rights will also be made public. Aim: Increasing transparency and accountability in extractive industries and strengthening dialogue with extractive industries stakeholders. Increasing accessibility and usability of government and business data and information on German extractive industries by publishing it on a public online portal and as open data. Status quo: Since February 2016, Germany has been a member of EITI and is currently preparing for the first reporting period (first D-EITI report to be submitted in August 2017). The multi-stakeholder process to implement the EITI standard was initiated in March 2015. For the purpose of implementation, representatives from the private sector and civil society identified common goals at MSG level. For example, in addition to fulfilling the mandatory requirements of the EITI standard, they seek to jointly promote more transparency. Ambition: With D-EITI, the Federal Government sends an important signal for strengthening the initiative worldwide. The multi-stakeholder process which shapes implementation of the initiative in Germany is also an innovative network strengthening cooperation between government, businesses and civil society as well as dialogue and transparency in Germany’s extractive industries. New or ongoing: ongoing Implemented by: Federal Ministry for Economic Affairs and Energy (BMWi) Organizations involved in implementation: D-EITI secretariat; Federal Ministry of Finance; Federal Ministry for Economic Cooperation and Development; Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety; state ministries of finance and economic affairs; state mining authorities; local associations; stakeholders of the extractive industry in Germany, including from the private sector (e.g. Federation of German Industries (BDI), Association of German Chambers of Commerce and Industry (DIHK) and civil society (e.g. Transparency International, Open Knowledge Foundation), who are represented in the MSG. Organizational unit and contact: Division IVB2, buero-ivb2@bmwi.bund.de Open government values addressed: Participation, transparency, accountability Relevance: With EITI, Germany is implementing the most important international standard for transparency and accountability in the extractive sector and is helping to further develop the standard and expand the initiative. Participation of government, industry and civil society in the MSG is an innovative model for participatory and responsive industrial policy. By presenting government data and contextual information on a web portal, activities of the government and public administration in the extractive industries become more transparent and understandable for citizens. The D-EITI open data approach will also improve the re-use and distribution of data and facilitate new innovative forms of cooperation.

IRM Midterm Status Summary

5. Financial Transparency—Implementing the EITI Standard

Language of the commitment as it appears in the action plan:

“To meet the standard of the international Extractive Industries Transparency Initiative (EITI) in Germany, we are working with a multi-stakeholder group (MSG) composed of the ministries concerned, the federal states, municipalities, civil society and businesses. The progress of national efforts (D-EITI) will be tracked in particular in an annual report which compares payments by extractive enterprises with the corresponding revenues of government agencies. Moreover, the D-EITI report will include comprehensive and understandable explanations on Germany’s extractive industries (e.g. legal framework, extracted resources, system of taxes and duties, and data on production and export) and address several special issues (e.g. intervention regulation under nature conservation law, renewable energy resources, etc.). In addition, information about mining rights will also be made public.”

Milestones:

5.1 Publishing government data on the German extractive industries in the first EITI report

5.2 Creating the legal basis for public access to certain information about mining rights by amending Section 76 of the Federal Mining Act (Bundesberggesetz, BBergG)

5.3 Providing government and business information and data on the German extractive industries on a public online portal and as open data

5.4 Discussing with stakeholders of the German extractive industries at MSG meetings on further promoting transparency in the sector and continuing EITI reporting

5.5 Publishing updated and possibly more government data on the German extractive industries in the second EITI report

Start Date: June 2017

End Date: June 2019

Context and Objectives

The Extractive Industries Transparency Initiative (EITI) is the first large multi-stakeholder initiative to promote transparency and accountability regarding extractive resource management. [18] Since its inception, it has been an important conduit for mainstreaming new modes of transparency, such as country-by-country reporting or beneficial ownership disclosure. It has also modeled new multi-stakeholder mechanisms to advance collective action in this area.

Having been a strong early supporter of the initiative, Germany decided in 2014 to adhere to the EITI standard for its own extractives sector (Deutschland-EITI, D-EITI). [19] The country has undertaken the necessary steps for full implementation of the EITI standard. It established a multi-stakeholder forum in 2015 [20] and compiled its first EITI report in 2017. [21] (Given that EITI inspired and served as a reference point for key ambitions and modes at OGP, EITI activities and setup are closely aligned with OGP values and mechanisms.) In addition, prior to Germany joining the EITI, information in the country on extractive industry operations and payments was highly fragmented in scale and scope across states and local communities. Related financial information held by companies was typically not publicly available. [22]

The commitment focuses on “[i]ncreasing transparency and accountability in extractive industries and strengthening dialogue with extractive industries stakeholders.” This also includes “[i]ncreasing accessibility and usability of government and business data and information on German extractive industries by publishing it on a public online portal and as open data.” [23]

The milestones are verifiable yet formulated in rather general terms. However, the milestones relate to activities that are well specified in the EITI framework. This applies, for example, to activities that focus on “[p]ublishing government data.” For such activities, the EITI prescribes a template, which this commitment implies that it follows. The listed milestones and activities are directly relevant to the OGP values of access to information (5.1 and 5.3) and civic participation (5.4). Given that reporting under the EITI also covers information on corporations’ tax payments, this commitment constitutes a significant expansion of transparency into areas of taxation and tax payments. In Germany, strong public norms and legal protections typically guard these areas for tax secrecy (Steuergeheimnis). [24]

Some of the related activities qualify as interesting institutional innovation. D-EITI has successfully navigated toward required changes in law (Milestone 5.2) and organized collective action on extractives transparency across all levels of government. D-EITI also continues its transition from producing expensive, time-lagged, stand-alone reports to systemically interlinking and curating real-time, dispersed data streams made available to public and private stakeholders. As a result, D-EITI has already made substantive inroads on key challenges to open government action. This makes D-EITI an interesting learning case for instituting incremental, yet highly important, institutional innovations as opposed to headline-grabbing technical integration efforts. These inroads warrant relevance to technology and innovation.

Implementation of this commitment could be important to incentivizing open government in other areas. Overall, the commitment could have a moderate potential impact on transparency in the extractives sector.

Next steps

The IRM researcher recommends that the Federal Ministry of Economic Affairs and Energy as the commitment holder encourages the D-EITI secretariat to make some information on institutional innovations and lessons learnt available to other OGP stakeholders. This information sharing would also benefit the broader action plan development and implementation process. Given the mature status of the transparency and disclosure architectures around extractives, the D-EITI could explore cutting-edge disclosure practices. For example, it could investigate practical mechanisms to move from periodic, stand-alone, consolidated reporting to distributed systems of continuous updates and interfaces with enterprise information systems.

[18] Extractive Industries Transparency Initiative, The Global Standard for the Good Governance of Oil, Gas and Mineral Resources,” March 2019, https://eiti.org/sites/default/files/documents/eiti_factsheet_en_oct2018_0.pdf.

[19] Deutschland Extractive Industries Transparency Initiative, EITI Candidature Application, 22 December 2015, https://www.d-eiti.de/wp-content/uploads/2015/12/Candidature-Application-Germany_22-12-2015.pdf.

[20] Deutschland Extractive Industries Transparency Initiative, Protokoll: Konstituierende Sitzung der Multi-Stakeholder-Gruppe (MSG) zur Implementierung der Extractive Industries Transparency Initiative (EITI) in Deutschland (D-EITI), 10 March 2015, https://www.d-eiti.de/wp-content/uploads/2017/09/1_Protokoll_MSG_Sitzung.pdf.

[21] Deutschland Extractive Industries Transparency Initiative, Report for 2016, August 2017, https://www.d-eiti.de/wp-content/uploads/2017/10/D_EITI_Report_2016.pdf.

[22] Interview with government representative.

[23] Federal Government of Germany, First National Action Plan 2017–2019, 15, https://www.opengovpartnership.org/documents/germany-action-plan-2019-2021/.

[24] The guiding principle of tax secrecy is enshrined in § 30 Deutsche Abgabenordnung [German Tax Law], https://www.gesetze-im-internet.de/ao_1977/index.html. The fundamental shift that the EITI reporting on tax payments constitutes in this regard has also been pointed out by an interviewee from the government.


Commitments

  1. Participatory development of research and innovation policy

    DE0022, 2019, Public Participation

  2. Participatory creation of regulatory policy

    DE0023, 2019, Public Participation

  3. Digital strategy pilot for rural regions

    DE0024, 2019, Public Service Delivery

  4. Open government in North Rhine-Westphalia

    DE0025, 2019, E-Government

  5. Policy co-creation in North Rhine-Westphalia

    DE0026, 2019, Land & Spatial Planning

  6. Data sovereignty in North Rhine-Westphalia

    DE0027, 2019, E-Government

  7. Open government portal in Saxony

    DE0028, 2019, Civic Space

  8. Open-source software in public administrations in Schleswig-Holstein

    DE0029, 2019, Subnational

  9. Regional Open Government Labs

    DE0016, 2019, OGP

  10. Civil Society Consulation on Foreign Policy

    DE0017, 2019,

  11. Create youth strategy

    DE0018, 2019, Marginalized Communities

  12. Craete federal agency for digital innovation

    DE0019, 2019,

  13. Transparency and participation in international aid

    DE0020, 2019,

  14. Strengthen and socialize open data policy

    DE0021, 2019, Open Data

  15. Conditions for OGP Participation

    DE0001, 2017, OGP

  16. Open Data in Administrative Practice

    DE0002, 2017, Capacity Building

  17. Open Data Environment

    DE0003, 2017, Capacity Building

  18. Access to Spatial Data

    DE0004, 2017, Capacity Building

  19. Financial Transparency - EITI Standard

    DE0005, 2017, E-Government

  20. Transparency in Development Policy

    DE0006, 2017, Aid

  21. Open Data for Intelligent Mobility

    DE0007, 2017, E-Government

  22. Citizen Participation in Environmental Policy and Urban Development

    DE0008, 2017, Capacity Building

  23. Electronic Procedures for Family Benefits

    DE0009, 2017, E-Government

  24. Knowledge Network for Lesbian, Gay, Bisexual, Transgender and Intersex People

    DE0010, 2017, E-Government

  25. Local Alliances for Family Initiative

    DE0011, 2017, Public Participation

  26. Share of Women and Men in Leadership Positions, Private and Private Sectors

    DE0012, 2017, E-Government

  27. Open Access to Academic Literature

    DE0013, 2017, E-Government

  28. Science Year 2018

    DE0014, 2017, Public Participation

  29. Federal Competition “Living Together Hand in Hand”

    DE0015, 2017, Citizenship and Immigration