December 08, 2010
Buried deep in the almost 900 pages of U.S. financial reform law recently passed by Congress are a few gems that Canadian mining companies need to be aware of if they trade on U.S. exchanges.
The Dodd-Frank Wall Street Reform and Consumer Protection Act is the most significant overhaul of the U.S. financial services since the Great Depression.
The most controversial item involves "conflict minerals," which include such things as coltan, gold, cassiterite and wolframite. Andrew Beck says the new disclosure requirements mean that manufacturers will be calling more on miners to find out about the source of their precious metals. "If you do have conflict minerals obtained from the Congo or adjoining countries, you've got to basically show due diligence and that you did the whole chain of custody to make sure that none of the proceeds are going to finance armed conflict."
Manufacturers will have to "certify the whole chain of custody and show what kind of due diligence they did. That can be quite significant and onerous," says Andy. Resource companies will have to "provide their customers sufficient backup to comfortably make these certifications."