The US Securities and Exchange Commission (SEC) is now requiring that thousands of US companies conduct what is described as a reasonable country of origin inquiry into whether or not their products contain any conflict minerals from the Democratic Republic of the Congo or surrounding countries.
Conflict minerals consist of gold, tin, tantalum and tungsten that are mined in areas of armed conflict and human rights abuse. Money from the sale of these minerals is typically funneled to arms groups to purchase weapons, etc.
Under the new SEC ruling, a company must report if they find any materials that might have come from troubled regions. Even if the results turn up clean, manufacturers must still report back to the SEC on a yearly basis. The first set of reports is due in before May 31, 2014.
Bloomberg points out that while these new requirements are stringent, they aren’t nearly as intense as ones that were proposed in 2010. Those rules would have made it mandatory for companies to prove their minerals didn’t come from Congo or neighboring areas but now they just have to show there isn’t any evidence of it.
Interestingly enough, the new rule excludes companies that put their brand name on a generic product. Walmart was singled out by the publication as an example of a large company that is excluded from the new requirements.
Either way, it’s a step in the right direction in the effort to reduce the amount of financing that groups with ill intentions receive.
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