The U.S. Court of Appeals re-confirmed its opinion that the SEC rule requiring companies to declare the conflict minerals sourcing status of their products violates the first amendment. The conflict mineral status refers to “DRC Conflict free” or “not been found to be DRC conflict free”. The SEC had requested the Court to review its original decision from April 2014 in light of was precedents set in other similar court cases.

The Court’s split decision (2-1) suggests that there are differences of opinion on this matter, even within the judicial circles. The court ruled only on the product declaration aspect of the SEC conflict minerals rule; all other provisions remain unaffected.

The April 2014 ruling was the result of legal action taken by the National Association of Manufacturers (NAM) against the U.S. SEC. NAM was hoping to strike down the entire conflict minerals rule; however, the court upheld all aspects of the rule except the product declaration.

The SEC still has the right to appeal this latest ruling. In the meantime, companies are not required to publicly declare the DRC conflict-free status of their products. However, other implications on organizations that are required to report to the SEC is speculated, but lacks legal certainty. This include that requirement for an independent audit performed on conflict minerals report (CMR).

For additional information and services to assess your environmental product compliance requirements, keep you up to date on the impact to your products and markets and to implement compliance procedures, contact ECD Compliance.