II 

118TH CONGRESS 

2D SESSION S. 5416 

To amend the Securities Exchange Act of 1934 to address the disclosure 

of payments by resource extraction issuers, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 3, 2024 

Mr. CARDIN introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To amend the Securities Exchange Act of 1934 to address 

the disclosure of payments by resource extraction issuers, 

and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘1504 Modernization 

5 Act’’. 

6 SEC. 2. SENSE OF CONGRESS; PURPOSE. 

7 (a) DEFINITIONS.—In this section: 

8 (1) AMENDED PROVISION.—The term ‘‘amend9 ed provision’’ means section 13(q) of the Securities 


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1 Exchange Act of 1934 (15 U.S.C. 78m(q)), as 

2 amended by this Act. 

3 (2) COMMERCIAL EXTRACTIVE INDUSTRY AC4 TIVITY; FOREIGN GOVERNMENT; PAYMENT; RE5 SOURCE EXTRACTION ISSUER.—The terms ‘‘commer6 cial extractive industry activity’’, ‘‘foreign govern7 ment’’, ‘‘payment’’, and ‘‘resource extraction issuer’’ 

8 have the meanings given those terms in the amended 

9 provision. 

10 (3) COMMISSION.—The term ‘‘Commission’’ 

11 means the Securities and Exchange Commission. 

12 (4) EXISTING PROVISION.—The term ‘‘existing 

13 provision’’ means section 13(q) of the Securities Ex14 change Act of 1934 (15 U.S.C. 78m(q)), as in effect 

15 on the day before the date of enactment of this Act. 

16 (b) SENSE OF CONGRESS.—It is the sense of Con17 gress that— 

18 (1) the United States should be a global leader 

19 with respect to the principles of transparency, good 

20 governance, and fighting corruption; 

21 (2) increased transparency with respect to pay22 ments by resource extraction issuers reduces risks 

23 for investors in the United States and allows citizens 

24 in resource-rich countries to hold their leaders ac25 countable; 


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1 (3) under the existing provision, the Commis2 sion— 

3 (A) has the authority to promulgate highly 

4 effective rules; and 

5 (B) should require resource extraction 

6 issuers to disclose payments and other informa7 tion that would be most useful to combating 

8 corruption abroad; 

9 (4) the Commission should enforce the intent 

10 behind the existing provision to cover all commercial 

11 extractive industry activities and not only activities 

12 relating to oil and natural gas; 

13 (5) this Act, and the amendments made by this 

14 Act, serve only to clarify, for the avoidance of doubt, 

15 the intent of the existing provision and to broaden 

16 compliance requirements under the amended provi17 sion to include all commercial extractive industry ac18 tivities; 

19 (6) even if this Act, and the amendments made 

20 by this Act, were not enacted into law, the Commis21 sion would have the ability to exercise the rule22 making authority of the Commission to achieve the 

23 intent behind the existing provision, including, in 

24 particular, to promulgate rules requiring project-byVerDate Sep 11 2014 01:12 Dec 28, 2024 Jkt 059200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S5416.IS S5416

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1 project reporting while prohibiting reporting based 

2 on the aggregation of contracts; and 

3 (7) the Commission should ensure that inves4 tors, and the public at-large, have the most detailed, 

5 complete, and timely information disaggregated for 

6 each commercial extractive industry activity carried 

7 out by a resource extraction issuer for which a pay8 ment has been made to a foreign government in a 

9 given fiscal year. 

10 (c) PURPOSES.—The purposes of this Act, and the 

11 amendments made by this Act, are to— 

12 (1) clarify that the authorities provided by, and 

13 the scope of, the existing provision include requiring 

14 the disclosure of disaggregated payments, informa15 tion, or contracts on a project-by-project basis; 

16 (2) under the amended provision— 

17 (A) broaden the scope of resource extrac18 tion issuers and forms of payment that are sub19 ject to the requirements of the amended provi20 sion; and 

21 (B) require the disclosure of payments 

22 made to criminal networks or other illicit actors 

23 that do not have legitimate governance claims 

24 over the resources resulting from, or with re25 spect to the regulation of, commercial extractive 


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1 industry activities that are conducted outside 

2 the United States; and 

3 (3) improve the security of critical supply 

4 chains, provide investor confidence in the foreign 

5 business operations of all resource extraction issuers, 

6 and support the ability of stakeholders in the United 

7 States, and citizens of the United States, to under8 stand the revenues received by foreign governments 

9 so as to increase accountability and ensure that the 

10 public in foreign countries receives benefits from 

11 those payments for the exploitation of the natural 

12 resources of those foreign countries. 

13 SEC. 3. DISCLOSURE OF PAYMENTS BY RESOURCE EXTRAC14 TION ISSUERS. 

15 Section 13(q) of the Securities Exchange Act of 1934 

16 (15 U.S.C. 78m(q)) is amended to read as follows: 

17 ‘‘(q) DISCLOSURE OF PAYMENTS BY RESOURCE EX18 TRACTION ISSUERS.— 

19 ‘‘(1) DEFINITIONS.—In this subsection: 

20 ‘‘(A) COMMERCIAL EXTRACTIVE INDUSTRY

21 ACTIVITY.—The term ‘commercial extractive in22 dustry activity’ includes commercial develop23 ment, exploration, extraction, processing, ex24 porting, and any other significant action relat25 ing to oil, natural gas, minerals, logging and 


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1 timber harvesting, or the conversion of natural 

2 forested lands for agricultural production (in3 cluding livestock forage), or the acquisition of a 

4 license for any such activity, as determined by 

5 the Commission. 

6 ‘‘(B) FOREIGN GOVERNMENT.—The term 

7 ‘foreign government’ means, as determined by 

8 the Commission— 

9 ‘‘(i) a foreign central government, in10 cluding any department, agency, instru11 mentality, State-owned enterprise or com12 pany that is wholly or partially State13 owned, central bank, or financial institu14 tion under the control of a foreign central 

15 government; or 

16 ‘‘(ii) a subnational government or re17 gional authority, including any instrumen18 tality, department, agency, or authority op19 erated and controlled by a subnational gov20 ernment or regional authority. 

21 ‘‘(C) INTERACTIVE DATA FORMAT.—The 

22 term ‘interactive data format’ means an elec23 tronic data format in which pieces of informa24 tion are identified using an interactive data 

25 standard. 


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1 ‘‘(D) INTERACTIVE DATA STANDARD.—The 

2 term ‘interactive data standard’ means a stand3 ardized list of electronic tags that mark infor4 mation included in the annual report of a re5 source extraction issuer. 

6 ‘‘(E) PAYMENT.—The term ‘payment’— 

7 ‘‘(i) means a payment that is— 

8 ‘‘(I) made to further a commer9 cial extractive industry activity; and 

10 ‘‘(II) not de minimis; and 

11 ‘‘(ii) includes— 

12 ‘‘(I) taxes, royalties, fees (includ13 ing license fees), production entitle14 ments, bonuses, inducements, services, 

15 securities, and other material benefits 

16 that the Commission, consistent with 

17 the guidelines of the Extractive Indus18 tries Transparency Initiative (to the 

19 extent practicable), determines are 

20 part of the commonly recognized rev21 enue stream for a commercial extrac22 tive industry activity; 

23 ‘‘(II) a payment processed in 

24 cryptocurrency; and 


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1 ‘‘(III) in-kind services or other 

2 non-monetary exchanges between a re3 source extraction issuer and a foreign 

4 government. 

5 ‘‘(F) RESOURCE EXTRACTION ISSUER.— 

6 The term ‘resource extraction issuer’ means an 

7 issuer that— 

8 ‘‘(i) is required to file an annual re9 port with the Commission; and 

10 ‘‘(ii) engages in a commercial extrac11 tive industry activity. 

12 ‘‘(2) DISCLOSURE.— 

13 ‘‘(A) INFORMATION REQUIRED.— 

14 ‘‘(i) IN GENERAL.—Not later than 

15 270 days after the date of enactment of 

16 the 1504 Modernization Act, and subject 

17 to the other provisions of this paragraph, 

18 the Commission shall issue final rules that 

19 require each resource extraction issuer to 

20 include in an annual report of the resource 

21 extraction issuer information relating to 

22 any payment made by the resource extrac23 tion issuer, a subsidiary of the resource ex24 traction issuer, or an entity under the con25 trol of the resource extraction issuer to a 


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1 foreign government, the Federal Govern2 ment, or any other recipient, including any 

3 bribe, ransom, or other payment paid to a 

4 foreign criminal network, local warlord, or 

5 chief that may not have legitimate govern6 ance claims, for the purpose of carrying 

7 out a commercial extractive industry activ8 ity, including— 

9 ‘‘(I) the type and total amount of 

10 such payments made for each project 

11 of the resource extraction issuer relat12 ing to those commercial extractive in13 dustry activities; and 

14 ‘‘(II) the type and total amount 

15 of such payments made to each such 

16 entity or person. 

17 ‘‘(ii) ELEMENTS.— 

18 ‘‘(I) DEFINITION.—In this 

19 clause, the term ‘project’ means as a 

20 contract, lease, or license that forms 

21 the basis of liability for a payment, 

22 consistent with the definition for that 

23 term used in other markets and by 

24 the Extractive Industries Trans25 parency Initiative. 


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1 ‘‘(II) REQUIREMENT.—The final 

2 rules issued under clause (i) shall— 

3 ‘‘(aa) require disclosures to 

4 be made on a per commercial ex5 tractive industry activity basis 

6 for a given fiscal year; 

7 ‘‘(bb) require the 

8 disaggregation of payments made 

9 by a resource extraction issuer on 

10 a per-commercial extractive in11 dustry activity basis, for the pe12 riod covered by the report in 

13 which the applicable disclosure is 

14 made; and 

15 ‘‘(cc) require that reports be 

16 filed and that furnished reports 

17 shall not be sufficient. 

18 ‘‘(iii) LIMITED EXEMPTIONS.—The 

19 final rules issued under clause (i) shall 

20 only permit limited exemptions from those 

21 rules, each of which— 

22 ‘‘(I) shall be justified and noti23 fied to Congress before any exemption 

24 is granted with respect to any such 

25 rule; and 


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1 ‘‘(II) may not permit the exclu2 sion of the disclosure of— 

3 ‘‘(aa) any conflict of a re4 source extraction issuer with for5 eign laws or contract terms; or 

6 ‘‘(bb) the commercial extrac7 tive industry activities of smaller 

8 reporting companies or emerging 

9 growth companies. 

10 ‘‘(B) CONSULTATION IN RULEMAKING.—In 

11 issuing rules under subparagraph (A), the Com12 mission may consult with any agency or entity 

13 that the Commission determines is relevant. 

14 ‘‘(C) INTERACTIVE DATA FORMAT.—The 

15 rules issued under subparagraph (A) shall re16 quire that the information included in the an17 nual report of a resource extraction issuer be 

18 submitted in an interactive data format. 

19 ‘‘(D) INTERACTIVE DATA STANDARD.— 

20 ‘‘(i) IN GENERAL.—The rules issued 

21 under subparagraph (A) shall establish an 

22 interactive data standard for the informa23 tion included in the annual report of a re24 source extraction issuer. 


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1 ‘‘(ii) ELECTRONIC TAGS.—The inter2 active data standard described in clause (i) 

3 shall include electronic tags that identify, 

4 for any payments made by a resource ex5 traction issuer to a foreign government or 

6 the Federal Government— 

7 ‘‘(I) the total amounts of the 

8 payments, by category; 

9 ‘‘(II) the currency, which may in10 clude cryptocurrencies, used to make 

11 the payments; 

12 ‘‘(III) the financial period in 

13 which the payments were made; 

14 ‘‘(IV) the business segment of 

15 the resource extraction issuer that 

16 made the payments; 

17 ‘‘(V) the recipient of the pay18 ments, and the country in which the 

19 recipient is located; 

20 ‘‘(VI) the project of the resource 

21 extraction issuer to which the pay22 ments relate; and 

23 ‘‘(VII) such other information as 

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1 terest or for the protection of inves2 tors. 

3 ‘‘(E) INTERNATIONAL TRANSPARENCY EF4 FORTS.—To the extent practicable, the rules 

5 issued under subparagraph (A) shall support 

6 the commitment of the Federal Government to 

7 international transparency promotion efforts re8 lating to commercial extractive industry activi9 ties. 

10 ‘‘(F) EFFECTIVE DATE.—With respect to 

11 each resource extraction issuer, the final rules 

12 issued under subparagraph (A) shall take effect 

13 on the date on which the resource extraction 

14 issuer is required to submit an annual report 

15 relating to the fiscal year of the resource ex16 traction issuer that ends not earlier than 1 year 

17 after the date on which the Commission issues 

18 final rules under subparagraph (A). 

19 ‘‘(3) PUBLIC AVAILABILITY OF INFORMATION.— 

20 ‘‘(A) IN GENERAL.—To the extent prac21 ticable, the Commission shall make available 

22 online, to the public, a compilation of the infor23 mation required to be submitted under the rules 

24 issued under paragraph (2)(A). 


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1 ‘‘(B) OTHER INFORMATION.—Nothing in 

2 this paragraph shall require the Commission to 

3 make available online information other than 

4 the information required to be submitted under 

5 the rules issued under paragraph (2)(A). 

6 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

7 There are authorized to be appropriated to the Com8 mission such sums as may be necessary to carry out 

9 this subsection.’’. 

Æ 


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