Lorax Compliance Ltd

Conflict minerals cyclone to hit manufacturing

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Courtesy of Lorax Compliance Ltd

In the latest round of new year’s forecasts, a noticeably absent topic from more general predictions for the packaging industry was the requirement for companies to comply with conflict minerals legislation.

This is of course hardly surprising as no EU legislation currently exists on conflict minerals – the legal obligation for companies to audit their supply chains to ensure they aren’t using the disputed minerals. In the US, the ‘conflict minerals’ the law applies to are defined as tantalum, tin, tungsten and gold (or ‘three ts and a g’ as they’re known in the industry). The legislation places an obligation on publicly traded corporations to report if the metals in their products are smelted from minerals mined within the Democratic Republic of the Congo (DRC) or adjoining countries.

It’s important to note that in the US the conflict minerals law doesn’t directly apply to packaging but refers to the manufacturers of the packaging machinery and equipment associated with producing it – for example, the laptops and design computers used.

It’s likely that the EU will soon produce its own version of the 2013 Dodd-Frank Wall Street Reform and Consumer Protection Act to ensure that EU companies don’t subsidise war or forced labour via their supply chain.

Whilst the EU is yet to reveal detailed plans to emulate US legislation, it’s under pressure from various political and environmental interest groups to grow some teeth on this issue – especially from manufacturers in the supply chains of American public corporations. This follows concern that the EU is at risk of becoming a trading hub for conflict minerals. Recent figures released by the European Commission estimate the EU was responsible for almost 25% of global trade in imports of tin, tantalum and tungsten in 2013 – the trading of which has helped to fund conflicts that have killed tens of thousands of people. This figure included the import of more than 100 million laptops into the EU – all of which contain these minerals.

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