Ethical Jewelry? Conflict minerals to face rules
COLLECTED BY CHINATUNGSTEN - DEC. 17, 2012 - You might want to avoid getting knocked off your block by jewelry, electronics and other items without knowing the origins of their manufactured parts.
After all, they could be made of “conflict minerals,” which are minerals exploited and traded by armed groups and helping to finance conflicts in Africa. This trade is creating a humanitarian crisis. Do you really want to buy something involved in human rights abuses — even if the price is right?
Uncle Sam, starting Jan. 1, is expected to have something to say on this issue.
New Securities and Exchange Commission rules, though under challenge by industry groups, are to require companies to start disclosing the use of certain conflict minerals. Conflict minerals, covered under its rule, include gold, tantalum, tin and tungsten. The rules impact minerals that originated in the Democratic Republic of the Congo or an adjoining country.
Also, U.S. companies manufacturing items meeting these criteria must disclose the information on a new SEC Form “SD.” Plus, in certain cases, disclosures must appear on websites. The first specialized disclosure report is due May 31, 2014, for the 2013 calendar year. They’re due annually after that.
If you’re concerned that the gift you’re buying might contain minerals that promote blood conflict, consider checking asking the seller before you buy.
Already, major companies, including Apple and Intel, and the World Gold Council, are setting standards and/or disclosing the information, says Paul A. Griffin, professor at the University of California, Davis Graduate School of Management.
Compliance costly
Although items made with “conflict minerals” may be cheaper than similar goods, this could change. Thanks to the cumbersome federal-disclosure requirement, Griffin contends items containing these minerals could rise in price overall. Expect the manufacturer to pass along the extra cost of compliance, ultimately hitting your pocketbook.
Meanwhile, because of the conflict mineral rules, the stock market starting in January may be dealing with more than just a “fiscal cliff.” Just as a host of spending cuts and tax increases threaten to take effect, the industry estimates the cost of complying with the rules could be as high as $16 billion.
The rules could specifically hurt American businesses, Griffin says. That’s because companies in China and other countries are not subject to these same rules.
Want to sell your heirloom jewelry? This could present a problem in the future if you have no documentation detailing the origin of its gold or other minerals.
Plus, when the origins of these minerals start getting disclosed, you might prefer to quietly keep heirlooms in your jewelry box.
Do you really want to be seen wearing jewelry whose origins are questionable?
Your heirlooms could lose personal value, Griffin suggests, much like mink coats did when animal rights activists called attention to the cruelty of the fur industry.
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