May 24, 2013 – May 31, 2013
The summaries provided in this Weekly Recap do not necessarily represent the views of Squire Sanders (US) LLP and should not be deemed to be endorsements of them. The Recap is intended to be a compilation of articles and events to encourage discussion within the conflict minerals community and to keep our readers updated on the most recent developments.
Companies Falling Behind in Conflict Minerals Compliance
The Herald (Rockhill, South Carolina) featured Aravo Solutions, Inc.’s recent survey focusing on companies’ readiness for conflict minerals compliance.
The results are in and The Herald reports, “that while reporting rules have been published by the SEC, most companies have yet to begin the required reasonable country of origin inquiry (RCOI) process, putting them at risk of failing to meet the necessary reporting deadlines.”
Key findings from Aravo Solutions, Inc.’s survey include:
- Only 15% of those surveyed have begun conducting their RCOI and due diligence; and
- Over 75% of those surveyed have placed conflict minerals compliance responsibility on several departments within the company.
Investors Release Statement Supporting Conflict Minerals Rule
Approximately fifty-five (55) investment groups have signed on to a statement expressing their disagreement with the lawsuit filed by the U.S. Chamber of Commerce, the Business Roundtable and the National Association of Manufacturers. The investors have over $450 million under management. An excerpt of the statement follows. “We believe the SEC’s final rule of Section 1502 protects investors and has an effect on a significant public interest. Given that the long-standing conflict in the Democratic Republic of Congo (DRC) has claimed more than five million lives and contributed to egregious human rights abuses such as rape, child soldiers, and slave labor, we believe companies must disclose their use of conflict minerals.”
To read the entire statement, please see “Investor Statement in Support of SEC Rule 1502 on Conflict Minerals”.
SEC Releases FAQs on Conflict Minerals
On May 30, 2013, the SEC released its long-awaited FAQ on Conflict Minerals. As the SEC states, “[t]hese FAQs are not rules, regulations, or statements of the Commission. Further, the Commission has neither approved nor disapproved these FAQs.” However, these FAQs do provide additional guidance on the conflict minerals rule. The FAQ is limited to twelve (12) questions whose answers reflect what has developed into the consensus view.
For a short summary on the SEC FAQs on Conflict Minerals, please see our blog post titled, “Additional Guidance via FAQs from the SEC.”