Conflict Minerals: new rules and steps to take

Assisting you in becoming Conflict Minerals Compliant

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Who is affected? How are Belgian companies affected?


Existing US legislation is applicable to all SEC issuers (including foreign issuers) that “manufacture or contract to manufacture products where conflict minerals are necessary to the functionality or production of the product”.

The industries most likely to be affected include:

  • Electronics and (tele-)communications (e.g. electronics, computers, wiring and mobile phones)
  • Aerospace and defense (e.g. engine components)
  • Automotive (e.g. engine components)
  • Jewelry
  • Industrial products
  • Power and utilities (e.g. turbines in power plants)

The SEC estimates that approximately 6,000 SEC issuers will be directly impacted by the rule and that many private companies in the supply chains of these issuers (could be from Belgium/ the EU) will be impacted indirectly.

If the issuer determines that its conflict minerals are from covered countries and are not from scrap sources or recycled, it must file a Conflict Minerals Report as an exhibit to a Form SD.

To identify whether its conflict minerals are from covered countries, SEC Registrants will require its suppliers to report on the minerals used in their products. This way, EU and Belgian companies are impacted and will have to report towards their US SEC registered clients on the use of Conflict Minerals and their corresponding origin further upstream the supply chain (regularly done via completion of the EICC GeSI Conflict Minerals Reporting files).

This would mean that these suppliers of SEC registrants will need to dispose of a similar strong management system, controls and reporting mechanism as they will not risk that reactive or ineffective responses to info requests strain their commercial relations.

Furthermore, SEC registrants could contractually require that its suppliers of conflict minerals, or suppliers of component parts or products containing conflict minerals, purchase them only from sources ultimately traceable to smelters and/or refiners who source only from outside covered countries.

Finally, the EU legislative initiative for similar Conflict Minerals legislation in the EU, once approved by EU lawmakers and governments, would result in the end in similar reporting and disclosure requirements than SEC registrants for EU stock exchange noted companies. This would significantly increase the number of EU based companies subject to Conflict Minerals legislation and not limit them to only those supplying to US SEC Registered companies.