Screen Shot 2017-12-05 at 9.43.18 PM.png

A Conflict-Free Minerals Policy for the State of Oregon

Oregon should institute responsible electronic purchasing through the enactment of a state procurement policy to require that all state-level purchases take into consideration the presence of conflict minerals when purchasing electronics. This could be achieved through executive action or legislation, and can link to existing federal and/or international guidelines and reporting mechanisms that companies should already have implemented.

The Never Again Coalition, Oregon Coalition for Humanity, Amnesty International USA Group 48 and Enough Project are all committed to supporting peace in the Democratic Republic of Congo (Congo).  We believe that transparency and stability in the mining sector in Congo will help to ensure that armed groups cannot profit from violent and illegal mining practices, which in turn stunt local communities from economic growth.  

We are doing our due diligence in looking ahead to the 2019 Legislative Session. We ask for your support and assistance in introducing a bill in 2019.

Why Is this Change Needed?

14795513009_21e3e69f3f_o.jpg

The ongoing conflict in the Congo has resulted in the deaths of more than 5.4 million people - more than any conflict since World War II.[1] Millions have been displaced, citizens continue to be terrorized, and rape is used as a weapon of war.

Conflict minerals have fueled and continue to help sustain the ongoing conflict. Armed groups have generated hundreds of millions of dollars by illegally extracting and smuggling tin, tantalum, tungsten, and gold (3TG). [2] These minerals eventually end up in consumer products such as computers and cell phones. Companies have the opportunity to contribute to peace in the Congo by making sure that the minerals they use in their products do not come from areas controlled by armed groups. But they will not take action unless their consumers require it.

Consumer activism is essential to ensure that companies and industries as a whole prioritize conflict-free sourcing. State-level legislation is a powerful way to amplify individual consumer activism by institutionalizing the demand for conflict-free products. The public expects that tax dollars should be spent on procuring products produced by companies with high human rights standards.

14795785469_7fe130ee63_o.jpg

Looking ahead to an Oregon State Conflict-Free Mineral Procurement Bill

By passing a state conflict-free minerals procurement bill, Oregon would become the fourth state in the country to enact legislation that places a preference on companies that are working to source conflict-free minerals for their products.

In the 2017 Session of the Oregon Legislature, Representative Williamson introduced HB 3381 – An Act relating to prohibitions on public contracting with entities that violated conflict minerals disclosure provisions of the Securities Exchange Act. The bill was referred to the House Business and Labor Committee, but did not receive a hearing. H.B. 3381 serves as an excellent starting point for a future conflict-free mineral procurement bill.  

It is important to note that an Oregon Conflict-Free Mineral Policy can link to existing federal and/or international guidelines and reporting mechanisms that companies should already have implemented. Therefore, the infrastructure is already in place for implementing an Oregon policy and should not place an undue burden on the State or on businesses.

The History and Future of Conflict Mineral Regulation

For decades, activists and affected communities in Congo have called attention to the links between their country’s minerals and its protracted armed conflicts. To many communities historically impacted by the violence and lawlessness surrounding Congo’s 3TG mines, the need for transparent supply chains has been clear.

14981832662_7a971bf173_o.jpg

The regulation of the 3TG minerals has developed as a result of pressure from end-user companies, other stakeholders and legislative action, all of which when combined, have contributed to a significant decrease in violence and exploitation in mining areas. [3]

In 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act became law. Section 1502 of Dodd-Frank, also known as the Conflict Minerals Act, was established to break the link between minerals and armed groups in Congo through creating a transparent supply chain for 3TG minerals. The rule simply requires all publicly traded companies to report if 3TG minerals sourced from Congo can be found anywhere in their supply chain. It does not require a boycott, nor does it require sanctions.

Since 2010, we have seen the infrastructure required for companies to audit their supply chains develop and prosper. Companies such as Intel, Kemet Electronics and Signet Jewelers have remained committed to sourcing from conflict-free mines in the region.

Change doesn’t happen overnight but it is clear that the creation of transparent supply chains has made a remarkable difference in the 3T mining sector in Congo. In 2016, a study found that 79 percent of miners at 3T mines surveyed in Congo now work in conflict-free mines.[4] This is a major change, as the UN stated in 2010 that "almost every mining deposit was controlled by a military group.[3]

Despite support from the tech industry, consumers, and Congolese civil society, Section 1502 is under threat by the current US Administration, and may be rescinded. There is good news though. The same disclosures that Section 1502 requires for companies using 3TG minerals in their products are the same guidelines in the Organization for Economic Co-operation and Development (OECD) Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High Risk Areas. The OECD is an intergovernmental organization and the guidelines it has put in place will continue regardless of what happens to 1502. We suggest that an Oregon state procurement bill use the OECD guidelines.

Support for a Conflict-Free Mineral Policy for the State of Oregon

The City of Portland  - We have met with all four Portland City Commissioners as well as Mayor Ted Wheeler’s office. We have full support from the city commissioners and anticipate support from the Mayor as well.

Oregon Businesses - We are currently seeking support from Oregon businesses and organizations. Recent supporters include:

Trios Studios, based in Lake Oswego, has been a leader in the way the jewelry industry conducts business globally - supporting fair trade gems, protecting miner’s rights, and supporting transparent supply chains for gems and minerals.

Portland’s TechForm Advanced Casting Technology is the industry leader in the casting of platinum group metals. Sustainability is a top priority for TechForm. Consideration of sustainable practices is a part of the daily fabric of their business operations.

FAQ:

What other cities and states already have conflict-free mineral procurement policies?

Massachusetts, Maryland and California, as well as 25 schools and six cities (including Portland) have implemented policies supporting conflict-free minerals trade and peace in the Democratic Republic of Congo.

How will this affect Portland and other cities in Oregon’s procurement or electronics?

In August 2015, Portland City Council voted unanimously to approve Resolution 37150. The city’s procurement policy now requires that makers of cellular devices and radio subscriber units to be used by the city be surveyed to determine possible connections to illegal mining and smuggling in eastern Congo by violent armed groups. The policy states that information will be used to support purchasing products made with conflict-free minerals from the Congo.[5] The City of Portland can only benefit from a state-wide procurement policy as it will make purchases for the City that much easier. Procurement for many other cities in Oregon is tied to State purchasing agreements. A state-wide policy will allow other cities in Oregon to become “conflict mineral free” also.

How does compliance affect the Tech Industry?

A study by Elm Sustainability Partners, an independent advisory firm, found that implementation costs related to federal conflict minerals reporting requirements for businesses have been substantially lower than expected and US companies have in fact seen “tangible business benefits.” According to Elm, compliance costs are 74-85% less than the initial SEC estimate. While the SEC projected $3-4 billion for total company costs, Elm estimates costs at $600-800 million for all companies. Additionally, these costs have dropped significantly as new tools and processes have been developed which streamline compliance.[6]

What does Congolese civil society have to say about conflict minerals?

Janvier Murairi Bakihanaye, a Congolese civil society leader and activist working in the mining areas of North Kivu said “whereas once there was a stand-off between militias representing different ethnic groups, local communities now live together in peace and harmony. Until recently, groups such as the Mai-Mai and Nyatura rebels and the Lafontaine group in the North Kivu province controlled a number of conflict mineral (tin, tungsten, tantalum and gold) mines. Rubaya is a case in point. The area was still under Nyatura rebel control as recently as 2013. Yet since mineral tracking systems were introduced in March 2014 as a result of the Dodd-Frank 1502 reforms, Rubaya has become an island of stability where communities live side-by-side. Before the economic boom spurred by a demand for conflict-free minerals, Rubaya had an estimated population of just 1,500. Now, less than four years on, it is home to more than 40,000 people.”[7]

Why should you support an Oregon Conflict-Free Mineral Procurement Policy?

Consumer activism is essential to ensuring companies and industries as a whole prioritize conflict-free sourcing. State-level legislation is a powerful way to amplify individual consumer activism by institutionalizing the demand for conflict-free products. By passing at state conflict-free minerals procurement bill, Oregon would become the fourth state in the country to enact legislation that places a preference on companies that are working to source conflict-free minerals for their products.

  1. International Rescue Committee, ”Mortality in the Democratic Republic of Congo: The Ongoing Crisis” (International Rescue Committee, 2016) available at https://www.rescue.org/sites/default/files/document/661/2006-7congomortalitysurvey.pdf
  2. Enough Project, “Progress and Challenges on Conflict Minerals: Facts on Dodd-Frank 1502” (Enough Project, 2016)
  3. Annie Callaway, “Demand the Supply: Ranking Consumer Electronics and Jewelry Retail Companies on their Efforts to Develop Conflict-Free Minerals Supply Chains from Congo” (Washington, Enough Project, November 2017) available at https://enoughproject.org/reports/demand-the-supply
  4. U.N. Security Council, “Interim report of the Group of Experts on the DRC,” S/2010/252, para. 77, p.17, May 24, 2010, available at http://www.un.org/ga/search/view_doc.asp?symbol=S/2010/252.
  5. Enough Project, “Portland Goes Conflict-Free,” August 2015, available at https://enoughproject.org/press-releases/portland-goes-conflict-free
  6. Enough Team, “New Analysis Shows Costs for U.S. Companies to Implement Conflict Minerals Law 74-85% Lower than Expected,” February 8, 2017, available at: https://enoughproject.org/blog/new-analysis-shows-costs-us-companies-implement-conflict-minerals-74-85-lower
  7. Janvier Murairi Bakihanaye, “A Congolese view on why we Need the U.S. conflict minerals law,” The Hill, February 23, 2017, available at: http://thehill.com/blogs/congress-blog/foreign-policy/320868-a-congolese-view-on-why-we-need-the-us-conflict-minerals

 

 

Screen Shot 2017-12-05 at 10.05.43 PM.png