I have asked whether the European Commission believes there is a need for an EU ‘conflict mineral’ law akin to the US Dodd-Frank Act As the Commission is aware, the USA introduced legislation in 2010 called the Dodd-Frank Act, whose Section 1502 deals with US companies having to provide evidence regarding traceability and provenance of minerals from designated conflict zones, such as the Democratic Republic of Congo (DRC) and its neighbours, in order to prove that the financial payments made are not funding armed militias who may be carrying out atrocities or other crimes against humanity. Section 1504 of the same Act deals with transparency of payments for the extractive industries, obliging US companies to report payments made by them to third-country governments in order to prevent allegations of corruption or malfeasance in public life. The EU has already introduced legislation to similar Section 1504, and has, moreover, launched a consultation with relevant stakeholders on the need to legislate for something akin to Section 1502 regarding traceability and provenance of the supply chain of minerals such as gold, tin, tantalum and tungsten, in line with OECD guidelines on good conduct in this ‘conflict mineral’ area. The Commission was responsible for the acclaimed Kimberley process in 2003, which was successful in reducing trade in West African so-called ‘blood diamonds’, and can draw on this experience to extend this principle to other minerals. The authorities in the DRC would appear to welcome EU legislation in this area, but some of the multinational mining houses have concerns about the regulatory burden involved, and there is always the danger that these types of measure will simply divert supplies of these essential elements to alternative jurisdictions such as, in the case of gold to Burundi, the United Arab Emirates (UAE) and on to India, thus bypassing the regulations. I have asked the Commission if it believes that the US Dodd-Frank Act has been useful in reducing funding to irregular armed groups in conflict areas such as the DRC and what impact assessment is it undertaking with regard to introducing similar measures in the EU?
Posted on: Fri, 12 Jul 2013 19:30:16 +0000
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