September 19, 2014 – September 26, 2014
The summaries provided in this Weekly Recap do not necessarily represent the views of Squire Sanders (US) LLP and should not be deemed to be endorsements of them. The Recap is intended to be a compilation of articles and events to encourage discussion within the conflict minerals community and to keep our readers updated on the most recent developments.
SEC Official Offers Conflict Minerals Disclosure Drafting Tips
Yin Wilczek with Bloomberg BNA reports in an article titled SEC Official Offers Three Pointers on Issuers’ Conflict Mineral Disclosures, that Keith Higgins, director of the SEC’s Division of Corporation Finance offered the following drafting tips for issuers:
- If issuers provide disclosure regarding both of their reasonable country of origin inquiry and due diligence measures, they should ensure not to combine both disclosures. Mr. Higgins did acknowledge that there may be some overlap, however.
- Issuers should avoid implying that their products are conflict free. An issuer’s products are either conflict free or they are not. If they are conflict free, an issuer must obtain an audit.
- Issuers must disclose their smelters and refiners if known.
For more information, please see Yin’s article SEC Official Offers Three Pointers on Issuers’ Conflict Mineral Disclosures.
Intel to Be Conflict Mineral Free in 2016
Will Green of Supply Management reports in his article titled Nearly All Intel Chips Will be Conflict Free from 2016 that Intel’s products will not contain conflict minerals starting in 2016. Mr. Green quotes Armin Sarstedt, Vice President in Intel’s Technology and Manufacturing group, “From 2016 onwards nearly all our products will be conflict mineral free. If a company does not buy into this, they won’t be a supplier for Intel.”
Mr. Sarstedt made these comments at the Gartner Supply Chain Executive Conference in London.
WSJ Reports that Only Four Companies Had Conflict Minerals Reports Audited
Emily Chasan of the Wall Street Journal reports in her article titled Just Four Companies Had Conflict Mineral Reports Audited that Intel Corp., Kemet Corp, Signet Jewelers Ltd., and Philips were the only companies who had their conflict minerals reports audited.
Shortly before conflict minerals disclosures were due last spring, the SEC released a Statement on the Effect of the Recent Court of Appeals Decision on the Conflict Minerals Rule. In this statement, the SEC provided, “If a company voluntarily elects to describe any of its products as ‘DRC conflict free’ in its Conflict Minerals Report, it would be permitted to do so provided it had obtained an independent private sector audit (IPSA) as required by the rule.” Accordingly, companies were not required to obtain an audit unless they described their products as conflict free. Companies could voluntarily elect to obtain an audit, however, for a variety of reasons, including the make-up of their investors or consumers.