CONTRIBUTED BY

Andrew Ledbetter andrew.ledbetter@dlapiper.com

Sanjay Shirodkar sanjay.shirodkar@dlapiper.com

The SEC recently issued new rules requiring various disclosures concerning “conflict minerals” that originate in the Democratic Republic of the Congo (DRC) or an adjoining country. 

After considering thousands of comments and conducting a public roundtable, the SEC adopted (by a narrow 3 – 2 vote) new rules and a new form relating to the use of conflict minerals.  The new rules apply to substantially all issuers that file reports under Section 13(a) or Section 15(d) of the Exchange Act and impose additional disclosure requirements on issuers that use conflict minerals in, or to produce, their products.  Because the rules apply broadly to public companies, they are also important for private companies with aspirations of becoming public.

The reporting requirements are based on a three-step analytic process, with each step building on the prior step.  Depending on the outcome of the three-step analytic process, an issuer may have to submit a report to the SEC that includes a description of the measures it took to exercise due diligence on the conflict mineral’s source and chain of custody. To facilitate the new disclosure required by the rules, the SEC has also adopted a new Form SD.Continue Reading SEC Conflict Minerals Rules Impact Many Public Companies