Conflict Minerals Rule Update

On 31 January 2017, SEC Acting Chairman Michael S. Piwowar issued a statement directing the SEC's staff to consider whether the 2014 guidance on the conflict minerals rule is still appropriate and if any relief of the rule is appropriate. The current conflict minerals rule requires companies that manufacture or contract to manufacture products containing tantalum, tin, tungsten or gold to conduct due diligence on their supply chains regarding such minerals in order to provide greater transparency on responsible sourcing.

Acting Chairman Piwowar noted that the conflict minerals rule may have had the unintended consequence of provoking a de facto boycott of minerals from portions of Africa, given the cost to companies of complying with the supply chain due diligence and disclosure requirements, and he questioned whether the rule has had any effect in reducing the influence of armed groups or in easing human suffering in the Democratic Republic of the Congo