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07/12/2016

Parliament votes for tougher conflict minerals regulation

Development Policy

Parliament votes for tougher conflict minerals regulation

The DRC is greatly affected by the phenomenon of conflict minerals.

[Julien Harneis/Flickr]

The European Parliament unexpectedly voted on Wednesday (20 April) in favour of a mandatory monitoring system for minerals originating from conflict zones. But negotiations with the Council and Commission will be tough. EurActiv France reports

European gold, tantalum (the material that makes mobile phones vibrate), tungsten and tin imports from conflict zones could be subjected to tougher surveillance procedures under a new draft regulation voted on by the European Parliament.

MEPs in Strasbourg voted to enforce an obligatory monitoring system for the whole supply chain of “conflict minerals”, affecting 800,000 European companies.

Applause broke out as lawmakers at the last minute passed amendments calling for compulsory ethical sourcing of materials from conflict areas like the Democratic Republic of Congo, Colombia and Afghanistan. The amendments passed by a vote of 378 to 300, with 11 abstentions.

“I must confess that it’s been one of the most intense moments I’ve experienced since becoming a member of the European parliament,” said Socialist Gianni Pittella of Italy, who leads the second biggest bloc in the assembly.

>> Read: Battle lines drawn as EU Parliament votes on ‘conflict minerals’

Mineral importers, smelters and refineries, but also manufacturers of consumer products (mobile phones, tablets, washing machines) will have to ensure that revenues from the minerals they use are not funding conflicts.

The bill is largely aimed at Africa, where minerals play a role in several violent conflicts. The Great Lakes region of the Democratic Republic of the Congo (DRC) is particularly affected by the phenomenon. Mineral production accounts for an average of 24% of gross national product (GDP) in African countries, and is implicated in no fewer than 27 conflicts on the continent.

Surprise vote

This surprise vote, led in large part by the European Parliament’s leftist parties, has considerably reinforced the initial proposal from the European Commission, which was initially based on a voluntary system.

It also reached beyond the proposal of the Parliament’s International Trade Committee, whose members had hoped to oblige only European smelters and refineries to source their materials responsibly.

>> Read: Parliament adopts relaxed measures on conflict minerals

A delicate trilogue on the horizon

Marie Arena, a Belgian lawmaker who steered the proposal in Parliament for the Socialists & Democrats (S&D) group, said, “The regulation voted through today is a historical victory that puts the respect of human rights above the profit of companies. Europe can become a pioneer the field of ethical economy.”

But the regulation still has a long road to travel. The bill’s slim majority in Parliament pushed MEPs to opt for quick negotiations with the EU Council and Commission before making their formal decision in first reading. This is a very unusual procedure.

Iuliu Winkler, a Romanian centre-right MEP who drafted the bill for the European People’s Party (EPP), said “Unfortunately, the divisions, which were already clear in the vote in the International Trade Committee, dominated the plenary vote. We are heading towards a complicated negotiation process.”

Among the primary concerns expressed by conservatives was the effect the regulation would have on small and medium-sized enterprises (SMEs). “Implementing such an obligation on the supply chain is utopian and impracticable, especially for SMEs,” said EPP member Franck Proust.

The European Conservatives and Reformist (ECR) group highlighted the negative impact the regulation could have on the legitimate trade of minerals in war-torn regions. British Conservative MEP Emma McClarkin said that “businesses who cannot afford the mandatory requirements, or get the verification they need, [may] seek to source minerals from elsewhere”.

Lobbying influence

The path travelled by the conflict minerals bill has already been a rocky one, beset by pressure from big business lobbies. The French business group Medef contacted MEPs ahead of this week’s plenary session, to warn them of the potentially costly consequences of a binding system that covers the whole supply chain. “The lobbies pushed their interests very strongly with the rapporteurs,” Green MEP Yannick Jadot confirmed.

“The extension of the regulation’s scope to all actors would be inefficient, impracticable and unreliable. Such an extension would engender very significant costs, particularly for small businesses: disproportionate compared to the expected results,” Medef stated in its document, seen by EurActiv.

French Socialist MEP Édouard Martin told the press: “I accuse Medef of having placed a price on human life.”

Positions

“This is a historic moment. MEPs have voted for a law that should make a real difference to the lives of those suffering under the trade in conflict minerals,” said Michael Gibb of Global Witness. “Despite concerted efforts by big business to weaken the legislation, MEPs have clearly positioned themselves for a strong, binding law that is fit for purpose."

MEP David Martin, S&D spokesperson on international trade: "A mandatory scheme is absolutely vital and I am extremely pleased the European Parliament has supported these proposals by the S&D Group. There have been voluntary guidelines in place for five years and over 80% of companies have chosen not to publish any information on their supply chain due to diligence."

Emma McClarkin MEP, Conservative spokesman on international trade: "Left wing MEPs are unfortunately more interested in an emotive headline than actually worrying about the impact on he lives for people on the ground in these war-blighted regions. As Conservatives, we are committed to preventing the funding of conflict through certain minerals that are often found in household items such as mobile telephones. Although the Commission recommended a voluntary system, we sought to strengthen the law to require mandatory due diligence for smelters and refiners and importers, building a functioning system from the ground up, while allowing for genuine trade in these metals and minerals to continue."

Keith Taylor, Green MEP for South East England: “The superb result of today's vote just goes to show how Europe can be a major force for good when countries and political parties from across Europe work together. The only way to effectively break the link with conflict financing is by creating a mandatory scheme for all companies that place these minerals on the European market. I'm pleased that MEPs from across the political spectrum have shown they understand this by voting in favour of binding transparency rules throughout the entire supply chain".

MEP Daniel Caspary, EPP Group Spokesman in the International Trade Committee: "We need a Regulation which can be put in place soon and helps the people in the relevant conflict regions. We must prevent jeopardising small mines because of unrealistic legislation and that the local people are then unintentionally pushed into unemployment, smuggling or illegal activities.

Background

Conflict minerals are mined in conditions of armed conflict and human rights abuses, mostly in the eastern provinces of the Democratic Republic of the Congo (DRC).

The looting of the Congo's natural resources is not limited to domestic actors. During the conflicts in the Congo, Rwanda, Uganda and Burundi particularly profited from the DRC's resources.

The most commonly mined minerals are cassiterite, wolframite, coltan and gold, which are extracted from the eastern Congo, and passed through a variety of intermediaries before being purchased by multinational electronics companies.

Since 2003, the European Commission has been a high profile donor to the Congo, particularly in the country’s unstable east. The EU’s Country Strategy Paper for the 2008-2013 period, under the 10th European Development Fund, pledges some €583 million of European funds to the country from DG Humanitarian Aid and Civil Protection (ECHO).

This is supplemented by funds from the EU general budget under the Development Cooperation Instrument, and funds for other bodies such as the European Instrument for Democracy and Human Rights, the Instrument for Stability, Eufor RD Congo, Eupol RDC, and Eusec RDC.

Further Reading