Wednesday, September 19, 2012

Legalities Complicate Sourcing Minerals

Conflict minerals supply warlords
in the Congo.
JOHANNESBURG (MINING WEEKLY)-- The Securities and Exchange Commission voted in Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Acts, which requires manufacturers to disclose if they have purchased conflict minerals. Conflict minerals, such as gold, tungsten, and tin provide funding for war groups in or around the Congo. As is the case with blood diamonds, it is difficult, though not impossible, to determine the origins of minerals purchased as they are often bought and sold many times before reaching a final buyer. Although manufacturers rarely have control over where the minerals come from, they can require that their suppliers prove that their minerals are conflict-free. This law may subsequently impact the minerals market worldwide and become a global standard, as the Sarbanes-Oxley law did. While there are no punishments for using conflict minerals, the public pressure from customers and organizations may in fact prove to be more damaging. Source: Complying With Conflict-Minerals Law Will Be A Challenge For Miners, Says Consultant (Reliability: High)

Comment: Since this is a new initiative by the United States, it may be many years before the impact of this law can be measured.

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