Dodd-Frank Act - conflict minerals

Conflic mineral Coltan

The U.S. Dodd-Frank Act to reform the U.S. financial market law was signed in July 2010 by President Obama.

Section 1502 of the Dodd-Frank Act refers to conflict minerals from the Democratic Republic of Congo (and neighboring countries), and names explicitly coltan, tungsten, gold and tin, of which the latter two play a role in the production of circuit boards. The term "conflict minerals" is based on the financing of armed conflicts in these countries, by means of the proceeds from sales of raw materials.

U.S. companies listed at the stock exchange are obliged by Dodd-Frank to disclose whether conflict minerals are used in their products and if so, whether these minerals originate from the DRC or neighboring countries.

This law establishes, through the guarantee of origin, for the first time far-reaching audit obligations for a supplier and material flows. This results from the product -related approach of the Dodd-Frank Act for the practice, the disclosure of the entire supply chain.

EICC company logoThe EICC (Electronic Industry Citizenship Coalition) and GeSI (Global e -Sustainability Initiative) make it compulsory for companies to ensure with all reasonable care for the selection of their supply chain, that those metals are not sourced from mines in the conflict region, which are controlled by military non-governmental groups or unlawful factions.

GeSI logo - Dodd FrankAt the joint website of EICC and GeSI, a template can be downloaded, which complies with the Dodd-Frank Act and is intended to keep the supply chain, manageable and free of conflict minerals. This template also includes a list of already certified smelters.

cfsi logoThe Dodd-Frank template, called CMRT (Conflict Minerals Reporting Template) can be found on the website of the cfsi (conflict-free sourcing initiative), which was specifically founded by EICC and GeSi. The cfsi is also offering an independent service for companies and their suppliers, for examination of melting and refining as "conflict-free", in line with current global standards.

ZVEI Logo - Printed Circuit Fabricators against conflict mineralsThe ZVEI (German Electrical and Electronic Manufacturers' Association), has recognized the problems related to this new law, and developed the position paper of the electrical industry to conflict minerals, reflecting the problems and showing possible solutions. The ZVEI also notes that the issue of conflict minerals intervenes deeply with the supply chain of German and European companies and thus it applies to the EU to prevent a law à la Dodd- Frank and rather reach for a humanitarian meaningful and viable solution for the industry. This could be the certification of the smelters as a " bottleneck", as only this type of certification is traceable and verifiable. Just before melting a chemical / geological proof of origin (fingerprint ) is possible.

Multi Circuit Boards supports both the actions of the ZVEI, and the EICC and GeSI / cfsi. We have the information of our suppliers regarding the origin of the metals of concern, which are used in the production process either already received or are just about to ask this. Based on the information which has been provided to us by our suppliers, no metals from the conflict region are included in the products supplied by Multi-CB according to our current knowledge. Suppliers of metals which are used in the production of Multi-CB products (especially gold and tin) must demonstrate that they understand and support the efforts of the EICC and GeSI and do not knowingly obtain conflict minerals.

Multi-CB Position Statement regarding Dodd-Frank Act

On request we will also send you our: Conflict Minerals Reporting Template.

We also support the efforts of the ZVEI to enforce compulsory registration of smelters for European suppliers, instead of the complicated and ineffective disclosure of the entire supply chain.

The ZVEI comes to the following conclusion:

The issue of conflict minerals reaches deep into the supply chains of German and European companies. It is important for the EU to prevent a law like Dodd-Frank and achieve a meaningful humanitarian and acceptable solution for the industry.

Certification of smelters, as the “bottleneck” within the global supply chain makes sense, as certification extends to a manageable number of companies and certification at this level is comprehensible and verifiable given that the chemical/geological proof of origin (fingerprint) is possible only before smelting.

Certification of the smelters is easier to implement and verify than a product-based certification over the entire supply chain. Such a systemic approach therefore offers considerable value added.