31 Mar 2015

Joint Industry Recommendations - EU Draft Regulation on Responsible Sourcing of Minerals

Joint Industry Recommendations - EU Draft Regulation on Responsible Sourcing of Minerals

AmCham EU, CECED, DIGITALEUROPE, IPC, JBCE, JEITA, KEA, SEMI, TABC and TechAmerica Europe would like to underline their support for Mr. Winkler’s report. We feel that it adopts a balanced approach to what is a complex, challenging and important topic.

While there are many good ideas in the proposed amendments, we cannot support any new concepts that do not adhere to the OECD framework or have not been subject to adequate regulatory impact assessment.

In the run-up to the INTA vote and the subsequent vote in Plenary, we strongly urge Members to consider the following:

Acknowledge existing industry schemes: several industry schemes have been established over a number of years specifically to help break the link between conflict financing and the sourcing of 3TG, allowing companies to make informed choices about conflict minerals in their supply chains. Complementing the Union system, schemes like the London Bullion Market Association Gold Standard (LBMA), the Responsible Jewellery Council Certification Programme (RJC) and the Conflict Free Sourcing Initiative (CFSI) focus on the same “pinch point” in the global metals supply chain as the Union does. These schemes use independent third-party audits to certify smelters and refiners with systems in place to assure sourcing of only conflict-free materials. There is mutual recognition between these schemes and the Union should also include provisions to allow for the accreditation of these schemes, to avoid duplication of efforts and reinforce their impact. These schemes have proved successful in increasing the transparency across the minerals supply chain. They should all be supported in order to continue to expand the number of compliant smelters and refiners.

Common list of smelters/refiners: a white list of smelters and refiners should be produced at EU level by the Commission in consultation with the OECD and in conjunction with the LBMA, CFSI, RJC and equivalent schemes in order to prevent duplication of effort, administrative and financial burden on companies and SMEs as well as confusion in the global marketplace.

Maintain focus on 3TG and exclude recycled materials: the majority of stakeholders are of the view that the Union system should follow or mirror the OECD due diligence framework. This means maintaining the current focus on tin, tungsten, tantalum and gold and excluding recycled materials, as well as following the OECD process to identify and address additional minerals. Each of the 3TG is dealt with in a dedicated supplement that has been prepared as a result of consultation with all relevant stakeholders. Consequently, additional minerals should only be considered within the Union system once the OECD process to identify and deal with such minerals has been completed.

Keep focus upstream: concentrating on upstream supply chain operators and on facilitating the transmission of quality information in the supply chain leverages the appropriate point in the supply chain, is consistent with the OECD guidance and with industry initiatives, and complements the Dodd-Frank Act Section 1502. Beyond the pinch point of smelters/refiners, it becomes exponentially more difficult to identify the origins of metals.

Supply chain due diligence information: In line with the OECD Guidance and in particular Step 5, downstream companies should be allowed the flexibility to identify the most appropriate ways to provide information on supply chain due diligence to their supply chains and customers. The EU Directive on disclosure of non-financial and diversity information could serve this purpose.

Defining conflict zones and high-risk areas: We do not feel that it should be up to companies to define conflict zones and high-risk areas. Definitions should adhere to internationally recognized definitions such as the OECD and the International Red Cross.

We look forward to working with Members to successfully conclude the process in Parliament towards a first reading agreement.

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