As authors of the Conflict Minerals provisions in the Wall Street Reform Act, Senator Dick Durbin (D-IL) and Congressman Jim McDermott (D-WA) issued the following statement in reaction to today's news that the Securities and Exchange Commission (SEC) issued a final rule on how companies who use these minerals should file their reports:
"The SEC has issued a commonsense and thoughtful rule that shines a light on the sourcing of conflict minerals that helps fuel some of the most vicious and violent groups in the world. We as a nation, as consumers and as industry have a responsibility to ensure that our activity in the global marketplace does not support or perpetuate violence. The rules announced today will provide transparency and accountability to an area of the market that long existed in the shadows; give consumers and investors much needed source-information about the products they buy; and will help lead to important and lasting changes on the ground in the Democratic Republic of Congo and areas throughout central Africa,"said Senator Durbin, who is the Assistant Majority Leader and a member of the Senate Foreign Relations Committee.
McDermott added, "I am very happy to see the SEC has issued a final rule for how companies should disclose their use of conflict minerals. The people of Central Africa, especially African women and children, need companies to act responsibly--and investors and consumers around the world need to know if companies are using a black market or a transparent market to manufacture their products. I am proud that many companies have already started reporting and the SEC has now created the kind of certainty everyone needs. Now that the U.S. has acted, it's time for China to do its part. The 30% of the black market that's still operating in Central Africa is mostly run by Chinese companies. This kind of irresponsibility --the funding of conflict through black markets for natural resources -- has to end.
"While we are still examining the rule, I am concerned that the SEC ignored the investor benefits of this law and that the SEC's cost estimate is far too high -- but lobbying and threats by the U.S. Chamber of Commerce and the National Association of Manufacturers made this distorted cost estimate something the SEC had to issue. As the SEC acknowledged, their estimates may be very high, and many think the final compliance costs will be much less. Hopefully the industry associations and far-right groups won't sue the SEC, essentially suing for the right to foment war in Central Africa. It's time to get on with the transparency that is so badly needed here."
Section 1502 of the Wall Street Reform Act requires companies that use conflict minerals from central Africa in their products to report to the SEC annually on what measures, if any, they are taking to make sure those minerals are not funding armed conflict.