Public reports

Statutory reporting obligation for extractive companies (§§ 341q et seq. HGB)

By way of derogation from the rules on German tax secrecy, companies extracting raw materials are subject to a statutory reporting obligation and disclosure of payments to public authorities in accordance with Section 341q et seq. of the German Commercial Code (HGB).

The Accounting Directive Implementation Law (BilRUG) of 23 July 2015 implemented the requirements of the EU Accounting Directive 2013/34/EU of 26 June 2013 into German legislation. The provisions of Sections 341q et seq. in the German Commercial Code (HGB) largely correspond to the requirements of the EITI. All the “large” limited companies and limited liability commercial partnerships involved in the extractive sector or in the logging sector in primary forests are subject to these reporting requirements under commercial law (cf. Section 341q HGB). The term “large” in the legal sense refers to companies that exceed at least two of the following three criteria on two successive reporting dates (Section 267(3) sentence 1 HGB):

• Balance sheet total of €25 million
• Turnover of €50 million
• An annual average of 250 employees

Within the meaning of Section 264d HGB capital market-oriented limited companies, as well as credit institutions and insurance companies in the legal form of limited companies (including limited liability commercial partnerships) are also subject to the reporting obligation, irrespective of their size. Besides reporting at the level of an individual company, the HGB also provides for an obligation to report at corporate level. Here it is not a prerequisite that the parent company itself is involved in the extractive sector or in the logging sector in primary forests. It is sufficient if this applies at least to a subsidiary.

The companies subject to the legal provisions are required to disclose payments made to government agencies above a “materiality threshold” of €100,000 per government agency, if these payments fall under one of the reasons for payment specified in Section 341r no. 3 HGB. In addition to tax payments, this includes e.g. licenses, concessions (for both it applies to mining licenses as such) and other contractual relationships related to the extraction of natural resources. The data must be allocated to individual projects (see Section 341r no. 5 HGB), if more than one project has been carried out in the year under review.

 

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