In politically unstable areas, armed groups often use forced labour to mine minerals. They then sell those minerals to fund their activities, for example to buy weapons. These so-called ‘conflict minerals’, can find their way into our mobile phones, cars and jewellery.

Both US Dodd-Frank 1502 and the EU regulation stand to improve supply chain transparency and companies’ accountability for sourcing conflict minerals.

EU Law

The EU passed a regulation in May 2017. The requirements start to apply on 1 January 2021. The EU regulation aims to:

  1. ensure that EU importers of 3TG (tin, tungsten, tantalum and gold) meet international responsible sourcing standards, set by the Organisation for Economic Co-operation and Development (OECD);
  2. ensure that global and EU smelters and refiners of 3TG source responsibly;
  3. help break the link between conflict and the illegal exploitation of minerals; and
  4. help put an end to the exploitation and abuse of local communities, including mine workers, and support local development.

The regulation requires EU companies in the supply chain to ensure they import these minerals and metals from responsible and conflict-free sources only. The regulation covers minerals and metals of gold, tin, tungsten and tantalum.

US Law

In 2010, Congress passed the Dodd-Frank Act, which directs the Commission to issue rules requiring certain companies to disclose their use of conflict minerals if those minerals are “necessary to the functionality or production of a product” manufactured by those companies.

Comparison between EU Law & US Law

  1. The US covers 3TG presence in products. The EU covers 3TG presence in ores or metals for EU importers.
  2. The US scope focuses on origin from Democratic Republic of Congo. The EU is global in scope, it uses CAHRA (conflict-affected and high-risk areas).
  3. Small volume importers of 3TG will be exempt under the EU Regulation. There is no de minimis exemption under the U.S. Rule.