The Parliament's Legal Affairs Committee last week approved amendments to EU transparency and accounting directives that would require EU-listed oil, gas, mineral extraction and forestry industry companies to disclose taxes and other payments made to governments on a project-by-project basis.
They would also, for the first time, require such companies to break down the information by country rather than on a global basis -- part of the Parliament's efforts to rein in corruption and crack down on tax avoidance.
The new rules were follow allegations of tax avoidance by multinationals such as Apple and Google.
The deal was reached in "tough" negotiations with members of the European Council and passed by the Legal Affairs Committee. It now goes to a plenary vote, mostly likely June 12 in Strasbourg, France.
The aim, said chief backer Arlene McCarthy, a British member of European Parliament of the Socialists and Democrats group, is to make companies dealing with strategic resources and national governments more accountable.
"This is a major step forward in the global fight against corruption," she said. "Parliament maintained a strong line during the tough negotiations with member states.
"As a result, project-level reporting, a low materiality threshold for disclosure and no exemptions from reporting payments were secured, giving communities in resource-rich countries the necessary tools to hold their governments to account for payments they receive from multinational companies."
Under the legislation's provisions, companies will need to publish payments to governments on a project-by-project basis, for example, for each lease or license obtained to access resources, such as a mine or an oil field.
The payments to be disclosed include production entitlements, certain taxes, royalties, dividends, bonuses, fees and payments for infrastructure improvements.
At the same time, the committee also approved a deal that would eliminate requirements for small and medium-sized companies to publish quarterly financial information, which is meant to discourage "short-termism" on financial markets.
The moves brought praise from Michel Barnier, European commissioner for internal market and services.
"I welcome this significant new advance in our efforts to make European companies more responsible and transparent," he said. "This agreement ensures that the disclosure requirements for the extractive and forestry industries as recently agreed in the accounting directive apply to all companies of those sectors that are listed in the EU."
"These new rules will encourage European companies to be more open about what they are paying to governments around the world," added Irish Finance Minister Michael Noonan, whose country holds the rotating EU Council presidency. "I believe that more transparent and more socially responsible companies will be better able to contribute to job creation and economic growth in Europe."
The deal was only reached when lawmakers turned back lobbying efforts by oil and gas companies that opposed the new rules and backers came together with center-right and right-wing groups in the Parliament, EurActiv.com reported.
Citing an unnamed EU source, the online publication said a bloc of ministers in the European Council, including those from Britain and the Netherlands, were also opposed.
The Netherlands was blocking the deal before abruptly reversing its position to express full support, the report said.