Conflict over Conflict Minerals: U.S. Policy Fails First Amendment Test

Abstract

In an effort to stem the resources available to armed groups in the Democratic Republic of the Congo, the U.S. government passed a law requiring issuers to file reports with the U.S. Securities and Exchange Commission discussing whether materials used in their products include "conflict minerals"-materials that are sourced from the Democratic Republic of the Congo and neighboring countries. The National Association of Manufacturers challenged the law on several grounds and was partially successful. The appeals court reviewing the challenges determined that a portion of the law violated the First Amendment by requiring issuers to state whether their products were "free" of conflict minerals. This paper describes the law and the court challenges, including the current status of appeals. The paper also describes the recent filings that were required to be made under the law and practice tips for issuers to comply with the law.