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Conflict Minerals Fact Sheet 

Dodd-Frank Act on Conflict Minerals


Background

In August 2012, the United States Securities and Exchange Commission (SEC) approved the Final Rule regarding the sourcing of conflict minerals as defined in the Dodd-Frank Wall Street Reform and Consumer Protection Act, Section 1502. This rule applies for public traded US companies, and requires these companies to report their usage of conflict minerals originating from the Democratic Republic of Congo (DRC), to the SEC on an annual basis. 
The US Congress passed the Dodd-Frank Act because of concerns that the exploitation and trade with minerals from the DRC and neighbouring countries was financing armed groups, and thereby fuelling the ongoing conflict in the area. It is widely reported that armed groups fight for control of the mines and use forced labour to mine and transport the minerals. The income from these illegal activities funds conflicts in the DRC region and contributes to an emergency humanitarian crisis.

The conflict minerals within the scope of the SEC Final Rule are tin, tantalum, tungsten and gold (3TG), both in the form of ore and as refined materials. The countries concerned include the Democratic Republic of Congo (DRC), Republic of Congo, Central African Republic (CAR), South Sudan, Rwanda, Uganda, Zambia, Angola, Burundi and Tanzania. 

The Dodd-Frank Act is only applicable to US listed companies, but their suppliers will also be involved in ensuring compliance with the Act as a contractual obligation. 

What is required by a US listed company?

US listed companies that use any of the 3TG’s in their products are required to perform a ‘Reasonable Country of Origin Inquiry’ (RCOI). The inquiry must be performed in good faith, and must be designed to determine whether any of the conflict minerals originated from the covered countries, or are from scrap or recycling sources. US listed companies must submit an annual Conflict Minerals Report to the SEC, with a description of the RCOI process and results.
US listed companies must undertake due diligence on the source and supply chain of its conflict minerals, if there is reason to believe that the minerals have originated in the covered countries and the minerals are not from scrap or recycling sources. 

The SEC classifies the US listed companies’ products as “DRC Conflict Free”, “Not DRC Conflict Free”, “DRC Conflict Undeterminable”, or “Recycled, or Scrap Due Diligence”. US listed companies filed their first Conflict Minerals Report to the SEC on May 31, 2014 (for the 2013 calendar year) and must conduct the reporting annually hereafter. 

What is the impact on the supply chain of US listed companies?

US listed companies are required to provide full disclosure of the content and origin of conflict minerals in their products, and will therefore require their suppliers to declare the content and origin of conflict minerals in supplied products, or maybe even to declare that all products delivered to the customer are “DRC Conflict Free”. 

Although the Dodd-Frank Act only applies to US listed companies, suppliers to the US listed companies will be required to conduct RCOI and due diligence on conflict minerals. 

LINAK activities concerning conflict minerals

LINAK is working actively towards full disclosure of the origin of 3TG in our products. However, due to the size and complexity of our global supply chain, it will take some time before we are fully able to provide our US customers all the information required to fulfil their disclosure obligations.

LINAK has taken the following actions:
  • We have created a policy outlining our principles and commitment towards conflict free sourcing. 
  • We are implementing a Reasonable Country of Origin Inquiry (RCOI) process to identify tantalum, tin, tungsten and gold (3TG) in our supply chain and to determine, to the degree reasonably, the country of origin of these minerals. The purpose of these processes is to identify the smelters in our supply chain to be able to conduct due diligence, and thereby facilitate DRC conflict free sourcing. 
  • • We are incorporating the principles of this policy into our Purchasing Terms and we are working with our suppliers to increase transparency in the supply chain. We are communicating our policy to suppliers and support relevant industry initiatives to facilitate that minerals used in our products are not contributing to the DRC-conflict. 

LINAK is supportive of applicable international database systems providing relevant disclosure of origin, including the use of the CMRT Conflict Minerals Reporting Template. LINAK is using the iPoint Conflict Minerals Platform (iPCMP ID no. 5562), and we encourage all involved customers and suppliers to join us, to improve the efficiency of the overall reporting process. 

Click here to read the LINAK policy on conflict minerals

Customers seeking conflict minerals information from LINAK are very welcome to forward their inquiries directly to the Conflict Minerals Compliance Team at conflictminerals@linak.com.

Supplier Requirements

LINAK requires that suppliers who provide components or materials containing any of the 3TG’s must actively work towards DRC conflict free sourcing. LINAK’s suppliers must perform their own RCOI and due diligence processes in order to facilitate valid and reliable DRC conflict free sourcing. We expect our suppliers to work with their own suppliers in the same way, to ensure traceability of conflict minerals to the originating smelters. 

All involved suppliers are encouraged to create an account for the iPoint system. If this is not possible, LINAK requires the CMRT reports to be send directly to the Conflict Minerals Compliance Team at conflictminerals@linak.com.

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