Although the law has limitations and loop-holes – not least the time it will take to come into force – the final binding nature of the regulation on larger upstream importers (i.e. those importing raw materials over finished goods) is an important step in ensuring a conflict-free supply chain.
The question will now move towards the rules of implementation and monitoring. EURAC have produced a briefing which explores that very subject, and an English summary can be viewed here: EN PRINT SUMMARY EurAc 2017 (2)
Parliament adopts binding law on conflict minerals
By Cécile Barbière
EURACTIV.fr – http://www.euractiv.com/section/development-policy/news/parliament-adopts-binding-law-on-conflict-minerals/ (translated by Samuel White)
16 March 2017
MEPs today (16 March) adopted a new law obliging importers of minerals to ensure that their business does not contribute to armed conflicts in certain areas of the world. EURACTIV France reports.
After two and a half years of debate, the European Parliament on Thursday definitively adopted the new rules on mineral imports from conflict zones, which will come into force in 2021.
This new law, which will apply across all EU member states, will oblige importers of tungsten, tantalum, tin and gold to ensure their supply chains are not linked to armed conflicts in the Democratic Republic of Congo (DRC) or in Africa’s Great Lakes region, where mines are often controlled by armed groups.
Binding traceability requirement
All European importers, from refineries to foundries, will be bound by this duty of care, with the exception of very small operations.
“Tungsten, tantalum, tin and gold are used in many objects like telephones and cars. We cannot allow the minerals that make up our everyday objects to be fund conflicts. It was urgent to put an end to this situation,” said French MEPs Tokia Saïfi and Franck Proust (EPP group).
The text, which sparked intense debate in the European Parliament, is seen as a real step forward in product traceability and the fight against armed conflicts. But despite being binding, the law will neither apply to the whole supply chain, nor will it cover all importers.
Certain shortcomings, like the fact that manufactured products will not be subject to the traceability requirements, have left loopholes in the system.
Green MEP Yannick Jadot highlighted the problems posed by the “downstream businesses” that manufacture tablets or smartphones using some of the materials targeted under this law. “During the law’s passage through Parliament, we managed to get the duty of care extended to cover all the actors in the chain. But this was dropped during the trialogue negotiations,” he said.
“But we managed to obtain a revision clause that will allow us to extend the law in the future,” he added.
Dodd-Frank law up in the air
Another shortcoming highlighted by Amnesty International is the law’s narrow scope. “This law only covers four minerals and omits other resources, like cobalt, which can be linked to serious human rights violations. We now expect the European Union to strengthen this legislation to make it binding on a larger number of businesses,” the NGO stated.
The timing of today’s vote is significant. US President Donald Trump in February announced his intention to review some of the provisions of the Dodd-Frank law, which governs mineral imports to the US and on which the EU’s own law is based.
“At a time when the United States is stepping back, with President Trump announcing he will unpick the Dodd-Frank law, it is vital for Europe to put its foot down on the issue of the corporate responsibility of multinationals,” said socialist MEP Emmanuel Maurel.
Nele Meyer, Amnesty International’s Senior Executive Officer for Business and Human Rights, said, “Further to President Trump’s proposal to row back on reforms designed to curb irresponsible US business practices, Europe’s role in cleaning up the trade of conflict minerals is now more important than ever. While this legislation is a positive step, it is undermined by various loopholes that exempt many companies – such as those that import conflict minerals contained within smartphones, laptops and other products. The European Union must strengthen this legislation in future.”
Iuliu Winkler, a Romanian EPP group MEP and Parliament rapporteur on conflict minerals, said, “The vicious circle has now been broken. The interests of communities and people caught in war and conflict are our priority. The new Conflict Minerals Regulation has the power to improve reality on the ground in war zones. Our aim was to create an efficient and workable Regulation, and we fully succeeded.”
Guy Thiran, Eurometaux’s director-general, said, “We’re pleased that EU institutions have been able to reach an agreement after several years of difficult political negotiations. The final Regulation might not be as effective as we’d pushed for, but we’re now looking forward to moving from words to actual implementation.
“Our priority is to make sure the procedure for recognising existing due-diligence schemes is workable and efficient. Europe’s smelters and refiners of 3Ts and Gold have already invested into becoming conflict-free through compliance with voluntary initiatives. EU policymakers have agreed that this best practice should be recognised – now’s the time to make that happen.”
“We do have concerns with several loopholes in the agreed Regulation. In particular, the exemption for gold imports lower than 100kg is an invitation for circumvention. A threshold has been included to avoid overburdening dentists and other small organisations importing gold in small quantities. But 100kg is enough gold for over 60,000 dental crowns. Do dentists really import such large amounts? We’ll continue to request lower thresholds to prevent unlawful companies from evading requirements.”
Spanish GUE/NGL MEP Lola Sánchez Caldentey, said, “After two years of negotiations with member states, the outcome is a watered-down piece of legislation. It only goes half way and does not put an end to the root causes of the problem. It is merely a band-aid to ease the consciences of those who are satisfied with minimal action. We voted in favour because this step is better than nothing, but we will be back for more. We will be back on behalf of those who are suffering in silence far from here. Just think of them every time you look at your phones.”
Conservative International Trade spokesman, Emma McClarkin MEP, said, “We want consumers and businesses to be able to buy products with confidence. That’s why we are taking this action to stop the trade in conflict minerals while we work alongside governments in the affected areas to find long term solutions to end the conflict”.
S&D spokesperson on conflict minerals, Marie Arena MEP, said, “The Commission’s initial proposal would have created a weak and ineffective system. We turned the Commission proposal upside down. The law adopted today will create a European market for responsibly traded minerals sourced in fragile regions and will cover a vast majority of the supply chain by mandatory due diligence standards and disclosure requirements.
“We wanted to go even further, and we will. Through future reviews built into the regulation we will continue to achieve a fairer system. Our struggle continues, but a crucial step has been taken today to break the vicious cycle.”
- Proposal for a regulation on supply chain due diligence – 5 March 2014
- Definitive text on conflict minerals – 16 March 2017