Last year, we provided an overview regarding the requirement that U.S. publicly traded companies disclose their use of “conflict minerals.” As of 2014, the Government Accounting Office reported that 1,321 companies filed the requisite disclosure. The GAO anticipated that over 6,000 companies could be affected by the rule. That discrepancy can be explained either by: (1) the GAO’s stats were off; or (2) a large number of companies did not make the filing. The numbers for 2015 will be available next month and we will update our readers on whether the number of compliant companies has increased.
This coming fall, I will be presenting a webinar about conflict minerals compliance with the help of one of firm’s summer associate’s Nicole Mulé. If you are interested in receiving an invitation, please email me at email@example.com.
In the meantime, a teaser. Are privately held manufacturers impacted by this law? The answer is yes. First, from a business perspective, many publicly traded companies require that companies in their supply chain certify that they do not use conflict minerals. Second, and more daunting, is that the Office of Foreign Asset Control (OFAC) has instituted sanctions for companies (even if they are not publicly traded) that import conflict minerals from the DRC region. Such sanctions can range from substantial monetary fines to criminal penalties, including lengthy prison time.