Dodd-Frank Act on Conflict Minerals
In 2010, the US Congress passed the Dodd-Frank Act, which directs US listed companies to inquire, register and disclose their use of so-called conflict minerals from the Democratic Republic of Congo and its neighbors.
Conflict minerals include gold, tin, tantalum and tungsten or their derivatives.
The US Congress passed the Dodd-Frank Act because of concerns that the exploitation and trade of conflict minerals by armed groups help to finance conflict in the DRC region and contributes to an emergency humanitarian crisirs.
The Dodd-Frank Act is only applicable to US listed companies, but their suppliers will also be involved in ensuring compliance with the Act as a contractual obligation.
What is required by a US listed company?
US listed companies that use gold, tin, tantalum or tungsten in their products are required to conduct a reasonable ‘country of origin’ inquiry. The inquiry must be performed in good faith and be designed to determine whether any of the conflict minerals originated in the covered countries or are from scrap or recycled sources.
US listed companies must submit a Conflict Minerals Report to SEC (Securities and Exchange Commission) with its de-termination and a description of and the results from the inquiry.
In addition, US listed companies must undertake a due diligence on the source and supply chain of its conflict minerals if the minerals may have originated in the covered countries and the minerals may not be from scrap or recycled sources.
The listed companies’ products shall eventually be classified as either “DRC Conflict Free”, “Not DRC Conflict Free”, “DRC Conflict Undeterminable” or “Recycled or Scrap Due Diligence”.
US listed companies shall file their first Conflict Minerals Report to SEC on May 31, 2014 (for the 2013 calendar year) and annually thereafter.
Impact on the supply chain of US listed companies
US listed companies are required to collect full disclosure of the content and origin of conflict minerals contained in their products and will most likely require their suppliers to declare the content and origin of conflict minerals or even to declare that all delivered products to the customer are “DRC Conflict Free”.
Although the Dodd-Frank Act only applies to US listed companies, supplier companies, that are part of the listed companies’ supply chain will be required to conduct due diligence and provide information on the source of these four minerals.
What is the position of LINAK?
As a first step, LINAK has established a group of people to examine what impact the Dodd-Frank Act has on LINAK and to make our suppliers aware of the Dodd-Frank Act.
Furthermore, we will engage in dialogue with relevant internal and external stakeholders to determine how LINAK can help our customers live up to their compliance obligation.
We will investigate reasonable, financial viable and pragmatic processes and solutions to enable disclosure of the origin of conflict minerals and we will be highly supportive of internationally recognized database systems providing relevant disclosure of origin.
Additional inquires and questions related to Conflict Minerals and LINAK progress can be sent to email@example.com