February 8, 2017
Somehow overlooked in discussion of the conflict minerals rule is that the DRC and adjoining countries account in total for less than 5% of worldwide production of each of the conflict minerals, except for tantalum. Consequently, the chances are no better than slight that any of the other three conflict minerals necessary to a particular issuer's products' functionality or production was sourced from the subject countries. The rule, if it is to be retained at all, should be revised so that it applies only to tantalum.
If the rule is retained and not revised as suggested, the Commission should give guidance on the following:
(1) Unless the issuer has another reason to believe that the conflict mineral was sourced from the subject countries, does an issuer's determination that the DRC and adjoining countries produce less than 5% of worldwide production of a conflict mineral constitute a reasonable country of origin inquiry.
(2) Is an issuer's determination that the DRC and adjoining countries produce less than 5% of worldwide production of a conflict mineral sufficient basis for the issuer to have no reason to believe that its necessary conflict minerals may have originated in the subject countries.
(3) Under Rule 12b-21, is an issuer relieved of conflict minerals reporting obligations if the issuer determines that required information is unknown to the issuer, and obtaining the information would involve unreasonable effort or expense.
Finally, if there are further hearings on the rule, I suggest that Congolese, who have an interest in the matter, be permitted to appear, as, apparently, they were excluded from the Commission's October 2011 hearings. http://financialservices.house.gov/uploadedfiles/hhrg-112-ba20-wstate-mdizolele-20120510.pdf