PackingLaw.com has reported that Securities and Exchange Commission (SEC) staff confirmed to members of a coalition of industry associations during a May 30th telephone call that metal compounds are chemically distinct from the metals themselves and that the SEC therefore did not intend the scope of the conflict minerals Rule to include them within the scope. This was in response to a letter sent by that coalition of associations to the SEC in December 2012 outlining this argument based on chemical difference. The SEC appears to agree with this concept although manufacturers who purchase gold or a 3T metal to make a metal compound would remain subject to the reporting requirements. For example, a manufacturer who uses tin to produce an organotin would be subject to the rule, while products manufactured by that company’s downstream customers, who purchase and use the chemical compounds in their manufacturing processes, would apparently not be subject to the rule since they are not using tin in their product but rather a new chemical substance. Note that this advice has not yet appeared on the SEC website in any official form and would perhaps need to clarify why ‘derivative’ within the definition of Dodd Frank does not mean a chemical substance produced from another substance. Further information is available here
