I hope NAM et al are successful in their motion for a stay of the conflict minerals rules, but it certainly isn’t a slam dunk. The SEC has filed its response to the motion for emergency stay. Predictably there isn’t a single point of agreement with both parties claiming their position is irrefutable. Some of the highlights are:
|NAM et al||SEC|
|There is “substantial doubt” the SEC would have kept the rest of the regulation in its current form||NAM must have failed to read the part of the rule that states if “any provision of this rule is held to be invalid such invalidity shall not affect the other provisions”|
|The unconstitutional requirement lies at the heart of the rule and the rule cannot function sensibly without it||NAM has no proof this is what Congress intended|
|Irreparable harm occurs because affected issuers cannot sue the government for economic harm||Ordinary compliance costs do not constitute irreparable harm. The rule has been in effect for a long time and the bulk of the compliance costs have been incurred. Sooner or later issuers are going to have to comply with this so the effort is not wasted.|
|The SEC stay and the guidance issued after the court decision required notice and comment before they took effect||NAM does not cite any cases supporting its position|
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