SEC Proposes Rules on Conflicts Minerals, Mine Safety and Resource Extraction
The SEC has proposed rules on three specialized disclosures required of public companies under the Dodd-Frank Act.
Disclosure of Use of Conflict Minerals
The proposed rules mandated by the Dodd-Frank Act would require new disclosures by reporting issuers concerning conflict minerals that originated in the Democratic Republic of the Congo or an adjoining country. Specifically, companies would be required to disclose annually whether they use “conflict minerals” that are “necessary to the functionality or production” of a product that they either manufacture or contract to be manufactured that originate from the Democratic Republic of the Congo or adjoining countries. The conflict minerals are cassiterite, columbite-tantalite, gold, wolframite or their derivatives. These minerals are essential to many products – from jewelry to cell phones to jet engines.
Disclosure of Mine Safety Information
The proposed rules would implement Section 1503 of the Dodd-Frank Act, which requires mining companies to include information about mine safety and health standards in their annual and quarterly reports filed with the SEC. Mining companies also would be required to file a Form 8-K with the SEC when they receive certain notices from the Mine Safety and Health Administration.
Resource Extraction Issuers
The proposed rules mandated by the Dodd-Frank Act will require resource extraction issuers to disclose payments made to the U.S. or foreign governments. Under the proposed rules, any resource extraction issuer would be required to disclose payments made to governments if the issuer:
- Is required to file an annual report with the SEC, and
- Engages in the commercial development of oil, natural gas, or minerals.
The rules would apply to domestic and foreign issuers and to smaller reporting companies that meet the definition of resource extraction issuer.
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Contact Steve Quinlivan for more information.