Sun, Jul 06, 2014 - Page 14 News List

US law against conflict minerals yields mixed results

The law has demilitarized many mines in the DR Congo by cutting the profits rebels earn from non-conflict-free minerals, yet most firms have yet to fulfill its requirement to trace the materials’ origins

By Eric Onstad  /  Reuters, LONDON

Boys pan for gold at a riverside at Iga Barriere in the Democratic Republic of the Congo’s resource-rich Ituri region on Feb. 16, 2009.

Photo: Reuters

A US law on conflict minerals is curbing African warlords’ presence around mines in the Democratic Republic of the Congo (DR Congo), campaigners say, but its full impact remains unclear, with most firms failing to pinpoint the origin of their metals by a deadline that passed last month.

Millions are estimated to have died over nearly 20 years of bloodshed in eastern DR Congo fueled by the minerals smuggled through Rwanda, Uganda and Burundi.

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, US companies must try to establish the origin of four metals often used by Congolese rebels to finance their activities.

Yet only 5 percent of firms making filings by the June 2 deadline traced the conflict status of the minerals used in their products, US risk management firm Source Intelligence said.

A grace period means big firms can say they were unable to get data for two years, but campaigners urged them try harder, saying the law had helped, but could do more to track the minerals, many of which are used in smartphones and other electronics goods.

“Overall, we’ve been disappointed with the response of companies, and the lack of meaningful information on the supply chain checks and risk assessments they are doing, although a few of the reports have been strong,” said Emily Norton, an assistant campaigner with non-governmental organization Global Witness.

The electronics sector has been the most robust at tracing the source of its minerals, Norton said, holding up chip giant Intel Corp as a rare example of a company that had conducted an audit.

Campaigners say the law has had a positive impact in three of the four metals it covers — tin, tantalum and tungsten — but that gold remains a problem.

A new certification scheme organized by non-profit industry group the International Tin Research Institute is being rolled out in North Kivu Province, after earlier projects in the DR Congo’s copper-rich southeastern provinces of Katanga and South Kivu.

Sasha Lezhev, a senior policy analyst with the Enough Project based in Washington, said about two-thirds of tin, tantalum and tungsten mines in the eastern DR Congo have been demilitarized.

In a report based on five months of field research, the organization said minerals not certified as “conflict-free” sold for 30 to 60 percent less, cutting profits for armed groups, but some analysts say the law’s impact has been overstated.

A Congolese government adviser cautioned that rebel involvement was hard to track in remote areas, while an academic specializing in the region said profits were still going astray.

“Dodd-Frank and the ensuing initiatives, including traceability and certification, have removed armed actors from the mines, but now we hear that army commanders are sending intermediaries to organize taxation on the site,” said Christoph Vogel, a researcher at the University of Zurich.

Global Witness said that last year, there was still high-level military involvement in the gold trade in the country’s east, and Lezhev has called on jewelers and the US government to counter this.

Campaigners are also urging the EU to strengthen a conflict minerals proposal released in March, making it mandatory instead of voluntary. Some of the legal experts advising the companies about the minerals law say the firms find it hard to discover the origin of their supplies.

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