PERC Reporting Code 2008

Resource Reporting Workshop15th May 2009 Dublin

www.percreserves.comDr Wynand Kleingeld

PERC 200822 July 2011 1

Why have a reporting code ?• Tenets

– Materiality

– Transparency

– Competence

– Impartiality

• Consistency – for investment decisions

• Reliability – “competent persons”

• Regulation of companies and markets (Bre-X)

• Protection against litigation

• Ease of communication: a common language22 July 2011 PERC 2008 2

Reserves Reporting Codes in UK and western Europe

• 1991: the IMM code, defined:

– Proven & probable reserves

– Measured & indicated resources

– The Competent Person

• 2001: “The Reporting Code”

– Update for international convergence

– Under the aegis of IMM, but co-sponsored by EFG, the Geological Society, and IGI

22 July 2011 PERC 2008 3

Why update the Code ?

• In response to increased globalisation

• In support of regulatory requirements, regionally and worldwide

• To meet needs of particular industry sectors

• To maintain a European reporting code for use in European markets

22 July 2011 PERC 2008 4

PERC: the Pan-European Reserves & Resources

Reporting Committee

• Committee convened in 2006 as the successor to the former IMM Reserves Committee

• Continued formal involvement of IOM3, EFG, IGI, and GSL

• IOM3 now involved through IMMa

• Scope explicitly broadened to cover Europe, not just UK

• Principal tasks:-– to maintain and update minerals reporting code for European markets

– Seek endorsement by the regulatory authorities

22 July 2011 PERC 2008 5

PERC Membership

• Representatives of

– (1) the four sponsoring organisations

– (2) CRIRSCO

– (3) key mining industry sectors

– (4) consultants

– (5) the financial community

22 July 2011 PERC 2008 6

Structure of PERC• Sub-committees:

– London Financial sub-committee (as a model for further similar sub-committees elsewhere)

– Industrial Minerals sub-committee

– Diamonds/Gemstones sub-committee

• Working group:

– PERC manages the CRIRSCO-GKZ working group on harmonisation of international and Russian reporting systems

22 July 2011 PERC 2008 7

The PERC Code 2008

• An update of the 2001 Reporting Code

• Progressive convergence with international standards as defined in the CRIRSCO code “template”

• Incorporating regional industry interests and requirements

22 July 2011 PERC 2008 8

Solid minerals: resources and reserves

22 July 2011 PERC 2008 9

PERC Code 2008: key changes

• Competent Person definition. A tighter definition but without using a ROPO list

• New section for historical estimates

• Revised and expanded industrial minerals / dimension stone / aggregates section

• Expanded diamonds section

• New section for coloured gemstones

• Appendix 4 competent person consent form added

22 July 2011 PERC 2008 10

Proposed relationships among PERC, the professions, and regulatory organisations11

United Kingdom…(& Western Europe?)

Professional & Industry Organisations Statutory / Semi-

Government

Organisations

Regulatory Organisations

Responsible

Entities

Compliance &

Guidance Standards

Those Required to

ComplyProfessionals Publicly Listed Companies

Relationship Key

PERC Code

Competent Person

Communication

Link

Accountability or

Enforcement or Oversight

May act asGuidanceResponsible for Compliance Communication

Link

Accountability or

Enforcement or Oversight

May act asGuidanceResponsible for Compliance

PERC

CESRIGI

EFG GSL

IoM3

Legal, Banking &

SX Reps

DRAFT

Industry &

AMA

Financial Services

Directive

Listing

Rules

AIM

Guidance

Notes

EU

SXs

Mechanism for

incorporation ?

ROPO

EU

NOMADS

UKLA

AIMLSE

UKLA

AIMLSE

Communication

Where are we ?

• Exposure Draft launched – 17 June 2008

• Consultation among other CRIRSCO members, and the mining and financial communities concluded November 2008

• Finalisation of Code with agreed amendments December 2008

• Code released January 2009

• Initiated discussions with the FSA/UKLA January 2009

22 July 2011 PERC 2008 12

Recommendations• PERC Code to be incorporated by reference into the

listing, prospectus and disclosure rules of the UKLA –Committee of European Securities Regulators (CESR)

• PERC Code to be the only code for reporting on the London SXs – if not, then other codes must be compatible with CRIRSCO

• Establish standing committee (PERC/UKLA) to agree amendments to the rules

• PERC will act as advisor to UKLA on disputes. UKLA is the ultimate sanctioning body – discussions ongoing with FSA/UKLA

22 July 2011 PERC 2008 13