Here comes another layer of “conflict minerals” restrictions.
President Obama last week set the stage for expanded sanctions against the Democratic Republic of the Congo and vicinity’s militia-ravaged region. A new Executive Order specifies that sanctions are called for against “individuals and groups tied to militias involved in the illicit trade of natural resources from the region” of the Democratic Republic of the Congo or DRC. If that criteria doesn’t include conflict minerals, what does?
Penalties to companies and individuals that fail to adhere to the expanding sanctions can include:
- Fines of at least $250,000
- Fines twice the amount of the underlying transaction
- Criminal penalties of up to $1,000,000
- Imprisonment for up to 20 years
Other conduct that will trigger future US sanctions:
- Actions or policies that threaten the peace, security, or stability of the DRC
- Actions or policies that undermine democratic processes or institutions in the region (DRC)
- The targeting of women and children with acts of violence (including killing, maiming, torture, and rape or other sexual violence), abduction, forced displacement, or attacks on schools, hospitals, religious sites, or locations where civilians are seeking refuge, or through conduct that would constitute a serious abuse or violation of human rights or a violation of international humanitarian law
- The use or recruitment of children by armed groups or armed forces
- Obstructing the distribution of, or access to, humanitarian assistance
- Attacks against United Nations missions, international security presences, or other peacekeeping operations.
Earlier this month, ahead of the Executive Order, US and United Nations Security Council added a Ugandan rebel group, the Allied Democratic Forces, to the sanction lists for “targeting children in situations of armed conflict through rape, killing, abduction and forced displacement.”
As far as conflict minerals go, this is yet another reason to know thy product ingredients and to continue tracking conflict minerals for compliance.
Thanks to many sources for these updates, for this one in particular thanks to Christopher T. McClure, Crowe Horwath LLP.