EU: Loopholes in regulation risk allowing trade in conflict minerals to continue

It would make a mockery of the system if 90% of importers are excluded from rules designed to prevent conflict minerals

AMNESTY INTERNATIONAL

PRESS RELEASE

17 November 2016

EU: Loopholes in regulation risk allowing trade in conflict minerals to continue

• Spokespeople available

European decision makers must close loopholes in a draft regulation on conflict minerals which would seriously undermine efforts to ensure that minerals entering the European Union (EU) do not finance conflict or human rights violations, Amnesty International said today.

Current proposals would exempt minerals worth millions of euros and up to 90% of gold importers from the new law. 

“A referee expects all football players on the team to comply with the rules of the game, not just 10% of those who walk onto the pitch. It would make a mockery of the system if 90% of importers are excluded from rules designed to prevent conflict minerals, which can be used in mobile phones, laptops, cars, and light bulbs, from entering the EU,” said Nele Meyer, Senior Executive Officer on Business and Human Rights at Amnesty International.

EU decision makers will meet on Tuesday to discuss the details of the new law, including the threshold under which importers are not obliged to comply with the rules.

The European Parliament has emphasized that thresholds are being set to relieve the smallest importers from the obligations, but this could mean imports worth 3.4 million euros are allowed to enter the EU unchecked. A threshold for refined gold, for example, has been proposed at 100 kg.

“Excluding small volumes of minerals from requirements is particularly problematic as small volumes are more likely to be linked to conflict. The US House of Representatives was informed that Al Qaeda training manuals contained instructions on smuggling small amounts of gold. Allowing small amounts to go unscreened could therefore be completely counterproductive to the aims of the legislation,” said Nele Meyer.

Amnesty International is also concerned that the so-called “White List” of responsible smelters and refiners could allow conflict minerals in to Europe through the back door. When sourcing from smelters and refiners from that list, which will be drawn up by the European Commission, companies will be allowed to apply less scrutiny. Inadequate checks, combined with insufficient, infrequent monitoring could allow irresponsible smelters and refiners to operate while being promoted as responsible by the Commission.

“Unless its screening and monitoring provisions are strengthened, this White List risks to becoming a white wash list, which would give negligent companies a pass to import more minerals without ensuring they are not from conflict areas,” said Nele Meyer.

Background

Current proposals are for a “Regulation of the European Parliament and of the Council for setting up a Union system for supply chain due diligence self-certification of responsible importers of tin, tantalum and tungsten, their ores, and gold originating in conflict affected and high-risk areas”.

The future Regulation will require companies who import ores or metals of tin, tantalum, tungsten, or gold, into the EU market to carry out due diligence on their supply chain, unless their imports fall below a certain threshold. Companies importing the same minerals and metals as part of products and components will not be included. Required due diligence standards will be broadly aligned with the OECD Due Diligence Guidance for Responsible Mineral Supply Chains of Minerals from Conflict-Affected and High-Risk Area. 

The Regulation is intended to break the link between trade in minerals and funding conflict and human rights violations.

The final trilogue negotiations on how to translate the political understanding on the conflict minerals regulation reached in June 2016 into law will take place on Tuesday 22 November from 16.00 – 18.30.
In 2005, the US House of Representatives was informed that Al Qaeda training manuals “included not only chapters on how to build explosives and clean weapons, but sections on how to smuggle gold either on small boats or concealed on the body. Using specially-made vests, gold smugglers can carry up 80 pounds, worth up to $500,000, on their person.”

For more information or to arrange an interview please contact Alison Abrahams in Brussels on [email protected] +32 2 548 27 73