SEC Halts Compliance With Most Costly Aspects Of Conflict Minerals Rule
As Connecting the Dots reported in February, the U.S. Securities and Exchange Commission (SEC) announced it is reviewing the efficacy of the commission’s conflict minerals rule and that, during the review process, companies would still be required to comply with the regulation. Last Friday, April 7, the commission announced that it would suspend “enforcement of the costliest requirements of” the rule.
Specifically, as Acting SEC Chairman Mike Piwowar explained, companies “will not be required to conduct a due diligence review or an audit, which are both part of the process used to determine the origin of the minerals.” The rest of the regulation will not be affected by the SEC’s announcement. For example, as Reuters explained, “Companies will still need to file required forms with the SEC and do origin inquiries, as they have been doing.”
The Metals Service Center Institute (MSCI) is very pleased with this announcement. The conflict minerals rule imposed huge costs on businesses in the industrial metals supply chain. At the same time, the regulation hasn’t improved the lives of the men and women living and working in conflict areas as it was meant to do.