EU regulation on conflict minerals

The EU Conflict Minerals Regulation has been in force since 1 January 2021, with the aim of ensuring responsible trade in tin, tantalum, tungsten and gold from conflict-affected and high-risk areas. This regulation requires companies importing into the EU to fulfil due diligence obligations in their supply chain. This enables them to ensure that their purchases do not contribute to the financing of armed conflicts. Companies are required to implement a supply chain management system, assess and manage risks, have audits carried out by independent third parties and report transparently on their practices.

The regulation applies to all companies, regardless of their size, and affects all regions worldwide that are affected by conflict or where there are deficits in public order and security. A handbook provided by the EU supports companies in identifying such areas. In addition, existing certification systems can be recognised under certain conditions in order to avoid multiple burdens. Larger companies must prove their compliance from the source of the raw materials. Compliance with the regulation is monitored by the EU member states, whereby recycled minerals and small import quantities are exempt.

The EU regulation on conflict minerals is linked to the EU regulation on critical raw materials, on which the EU member states have so far reached a provisional agreement. While the conflict minerals regulation specifically addresses the ethical sourcing of certain minerals, the draft regulation on critical raw materials focusses on securing the supply and sustainability of a broader range of materials important to the EU economy. Compared to the regulation on conflict minerals, significantly more raw materials are affected by the draft regulation. A total of 34 raw materials are listed as strategic or critical, including rare earths, lithium, silicon, but also tantalum and tungsten. Both sets of regulations contribute to the promotion of sustainable and responsible supply chains, but from different perspectives: one by preventing conflict financing and human rights violations, the other by ensuring the availability of essential materials for the European economy.

Implications for companies

It is crucial for companies to monitor their supply chains precisely and recognise risks at an early stage. Implementing an effective risk management process and conducting regular, independent audits are essential. Through transparent reporting, companies can strengthen the trust of their stakeholders and fulfil compliance requirements. The EU Conflict Minerals Regulation, together with the EU draft regulation on critical raw materials and the US Dodd-Frank Act, which focuses on the Democratic Republic of Congo and its neighbouring countries, aim to ensure full supply chain verification to prevent the financing of conflict.

How we can support

The lawyers of the Green Trade Team provide in-depth advice on the EU Conflict Minerals Regulation. We actively follow all stages of the legislative process and provide you with regular updates on current developments. Our law firm's advisory services cover both the preparation for the implementation of the regulation and the adaptation to the existing regulations. We develop customised solutions and offer strategic advice in order to meet the specific requirements of the Regulation. In doing so, we not only take into account the EU-wide regulations, but also relevant international standards, thanks to our cooperation with partner law firms worldwide. The aim is to make your supply chains compliant and ensure responsible sourcing of minerals.