GAO Issues Mixed Report on Dodd-Frank Effectiveness

On July 18, 2013, the U.S. Government and Accountability Office (GAO) issued a report to Congressional Committees, “SEC CONFLICT MINERALS RULE — Information on Responsible Sourcing and Companies Affected.”

Under Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Act), the GAO was required to report, beginning in 2012 and annually thereafter, on the effectiveness of the Securities and Exchange Commission’s (SEC) conflict minerals rule in promoting peace and security in the Democratic Republic of the Congo (DRC) and adjoining countries.

Although the GAO did not directly address the effectiveness of SEC’s conflict minerals disclosure rule because the first disclosures of companies’ use of conflict minerals will not be due to SEC until May 2014, the report did find that:

  • Stakeholder-developed initiatives may facilitate companies’ compliance with the SEC final conflict minerals rule
  • Lack of security, lack of infrastructure, and capacity constraints could undermine companies’ abilities to ensure conflict-free sourcing from the region
  • Of the 278 smelters and refiners identified by the GAO (out of an estimated 500 to be in existence), 63 had a conflict minerals policy publicly available on their websites and 26 of the 63 were designated as “conflict-free” by the EICC and GeSI Conflict Free Smelter Program.

The full report is available at http://www.gao.gov/assets/660/655972.pdf.

IPC continues to play a leadership role on this issue and will remain actively engaged in advocating for our members concerns as they comply with the Act. For more information about IPC and conflict minerals, please visit IPC’s website at www.ipc.org/conflict-minerals.

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