Conflict minerals disclosure rule heads to court

Intel Corp. CEO Brian Krzanich delivers a keynote address at the 2014 International CES at The Venetian Las Vegas on January 6, 2014 in Las Vegas, Nevada. Krzanich announced that in 2014, all minerals from the Democratic Republic of the Congo used to make Intel microprocessors will be conflict free.

Today, a federal appeals court hears arguments against a rule requiring companies to start reporting conflict minerals in their products. These minerals are mined in and around the Democratic Republic of Congo (DRC), and used by armed groups to fund a conflict that’s killed millions.

Critics say the rule is onerous and may have unintended consequences.

Tin, tantalum, tungsten, and gold are the minerals in question. They help you send texts. They make your phone vibrate. They are deeply embedded in our electronic lives and the supply chains of thousands of companies.

Sasha Lezhnev is a senior policy analyst with the Enough Project. He says some companies are enthusiastically rooting out conflict minerals.

“I just traveled with Intel, with Motorola Solutions and a couple of other companies to Congo, and we were identifying mines that they can start sourcing from in a clean manner,” he says.

But some industry groups say compliance is too costly and complex. J. Peter Pham is the director of the Atlantic Council's Africa Center. He worries the rule has an unwanted side effect.

“Because of the reporting requirements and the burden put on global companies, they’ve simply chosen not to do business with any companies in the DRC,” he says.

Pham says that’s driving many of the region’s individual miners out of work.

Under the rule, which is part of the Dodd-Frank Act, there’s actually no penalty for using conflict minerals. The only damage is to brand reputation.

About the author

Kate Davidson is a regular contributor to Marketplace.

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