Since 2013, U.S. investors with more than $500,000 invested in Myanmar (Burma) have been required to report about the impact of their investments on human rights, labor rights and the environment. The U.S. Reporting Requirements for Responsible Investment in Burma serve as an important tool to hold U.S. companies accountable for the business they do abroad.
As Myanmar moves forward with democratic reforms, the Reporting Requirements are one way to ensure that the U.S. investment does not undermine progress. The original Reporting Requirements expired last month, and the State Department initiated a renewal process.
About 60 organizations support renewal of the rule and called to strengthen it (including us). These included some of the global organizations such as Amnesty International and Global Witness, as well as local human rights and women’s organizations (The public comments are available here and here.) Only two organizations criticized the Reporting Requirements. Their reason? It is too burdensome to find out if companies harm their workers or other people. Unsurprisingly, those critics were the U.S. Chamber of Commerce and the American Chamber of Commerce Myanmar Chapter, known as AMCHAM Myanmar.
So what did the State Department do upon receiving 60 comments in favor of the renewing and strengthening the Reporting Requirements, and two criticisms? While they proposed reissuing the Reporting Requirements, the proposal would increase the threshold of investment requiring reporting tenfold – from $500,000 to $5 million. The State Department decided that the Reporting Requirements should not apply to as many investors, effectively weakening the rule.
The positions of the U.S. Chamber of Commerce do not necessarily represent the business community. Individual U.S. companies, including Coca-Cola and The Gap, have spoken up in support of the Reporting Requirements, and no individual company submitted a critique – but the Chamber still fights against it.
Funnily enough (or maybe not that funny) something similar happened in the U.S – with the same players. The Washington Post reported that a survey of businesses–members of the Chamber –showed that they were in favor of increasing the minimum wage, while the Chamber was profusely advocating against it.
We don’t know what drove the State Department’s decision, but we have a guess. The State Department appears to have accepted comments by companies during the public comment period that have not been published or otherwise made public.
AMCHAM’s website features a survey about the Reporting Requirements – including the question, “What changes would you like see made to the current reporting requirements?” and the suggested response “Change the threshold for required reporting” – that it directed companies to submit to a contact at the U.S. Embassy in Yangon. AMCHAM’s own public comment references the “recent survey.” But neither AMCHAM, the Embassy, nor the State Department have made these survey responses publicly available. ERI has submitted a request pursuant to the Freedom of Information Act to find out what exactly went on in that exchange. We will keep you posted once we get a response from State.
There’s no other obvious reason that the State Department would propose such a huge increase in the reporting threshold. The move cannot be justified based on the public record. It seems mostly likely that these secret comments were the basis for the change.
Such an arrangement is highly inappropriate and deprives the public of information and a fair opportunity to comment. ERI’s latest comment points out how problematic it is to rely on secret comments, and also urges the State Department to keep the previous reporting threshold. We’ll see what the State Department ultimately decides.