Section 1502 of the Dodd Frank Act

Reporting
- Companies with “Democratic Republic of Congo (DRC) conflict-free” products must: (1) provide a description of measures taken to exercise due diligence; (2) conduct an audit and identify the auditor; (3) provide a description of products manufactured or contracted to be manufactured; and (4) certification that the audit is included in the report
- If a company’s products are found to be not “DRC conflict-free” in addition to the report, companies must: (1) describe the facilities used to process conflict minerals; (2) outline the country of origin of the conflict minerals; and (3) describe efforts to determine the mine or location of origin with great specificity
- If a company is unable to determine if products are “DRC conflict-free” it must: (1 ) describe the facilities used to process conflict minerals; (2) outline the country of origin of the conflict minerals; (3) describe efforts to determine the mine or location of origin with great specificity; and (4) identify the steps taken to improve due diligence and mitigate the risk of conflict mineral use
Due Diligence
- Companies required to file a Conflict Mineral Report must exercise due diligence. There is no definition of due diligence, but measures should comply with a nationally or internationally recognized framework like the Organisation for Economic Co-operation and Development (OECD) Framework.

Human Rights
- Extreme levels of violence in the Democratic Republic of the Congo (DRC) due to mineral trading.
Environment
Broad ranging
- Conflict minerals, Gender-based violence, humanitarian crisis

Own Operations
Subsidiaries
Direct Suppliers
Indirect Suppliers
- This Act applies across the full supply chain involving conflict minerals sourced from the Democratic Republic of Congo and surrounding areas.
- The Act holds indirect suppliers liable for compliance with the Act because companies are required to report minerals’ location of origin and facilities used if minerals are not “DRC conflict-free” or the status of the minerals cannot be determined.

Large Companies
SMEs
All sectors
- Public companies listed on U.S. exchanges with products that contain tantalum, tin, gold, or tungsten.

Monitoring
- The U.S. Securities and Exchange Commission (SEC) can require U.S. listed companies to disclose whether conflict materials originated from the DRC or a neighboring country if: (1) a company uses minerals such as tantalum, tin, gold, or tungsten; (2) the company files reports with the SEC under the Exchange Act; and (3) the minerals are “necessary to the functionality or production” of a product manufactured or contracted to be manufactured by the company
- There is limited guidance on what constitutes a mineral that is “necessary to the functionality or production.” This largely depends on the specific facts and circumstances, whether the conflict mineral is intentionally a part of the product, whether the mineral is necessary for the product’s purpose or function, the primary purpose of the product itself, and whether the mineral is added for decorative purposes

Section 1502 of the Dodd Frank Act requires U.S. listed companies to disclose whether conflict minerals (gold, tin, tungsten, and tantalum) are used and if these minerals originate from the Democratic Republic of the Congo (DRC) or adjoining countries.
If there is reason to believe that minerals originated in DRC or adjoining countries and is not from recycled materials, the company will be required to conduct and publicly disclose a due diligence report.
DRC conflict-free means: products do not contain minerals that directly or indirectly finance or benefit armed groups in the Democratic Republic of the Congo or an adjoining country.

Law