I 111th CONGRESS 1st Session H. R. 4128 IN THE HOUSE OF REPRESENTATIVES November 19, 2009 Mr. McDermott (for himself, Mr. Wolf, Mr. Frank of Massachusetts, and Mr. Payne) introduced the following bill; which was referred to the Committee on Foreign Affairs, and in addition to the Committees on Ways and Means and Armed Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To improve transparency and reduce trade in conflict minerals, and for other purposes.
1.
Short title
This Act may be cited as the Conflict Minerals Trade Act.
2.
Findings
Congress finds the following: (1)The Democratic Republic of the Congo was devastated by a civil war in 1996 and 1997 and a war that began in 1998 and ended in 2003, which resulted in widespread human rights violations and the intervention of multiple armed forces and armed non-state actors from other countries in the region. (2)Despite the signing of a peace agreement and subsequent withdrawal of foreign forces in 2003, the eastern region of the Democratic Republic of the Congo has continued to suffer from high levels of poverty, insecurity, and a culture of impunity, in which armed groups and military forces continue to commit widespread human rights abuses. (3)According to a study by the International Rescue Committee released in January 2008, conflict and related humanitarian crisis in the Democratic Republic of the Congo have resulted in the deaths of an estimated 5,400,000 people since 1998 and continue to cause as many as 45,000 deaths each month. (4)Sexual violence and rape remain pervasive tools of combat used by all parties in eastern region of the Democratic Republic of the Congo to terrorize and destroy communities. Sexual violence and rape affect hundreds of thousands of women and girls, frequently resulting in traumatic fistula, other severe genital injuries, and long-term psychological trauma. (5)The use of child soldiers on the front lines, as bonded labor, and as sex slaves is a widespread phenomenon among armed groups in the region. (6)A report released by the Government Accountability Office in December 2007 describes how the mismanagement and illicit trade of extractive resources from the Democratic Republic of the Congo supports conflict between militias and armed domestic factions in neighboring countries. (7)In its final report, released on December 12, 2008, the United Nations Group of Experts on the Democratic Republic of the Congo found armed groups in the eastern region of the Democratic Republic of the Congo continue to fight over, illegally plunder, and profit greatly from the trade of columbite-tantalite (coltan), cassiterite, wolframite, and gold in the eastern Congo. (8)United Nations Security Council Resolution 1857, unanimously adopted on December 22, 2008— (A)broadens existing sanctions relating to the Democratic Republic of the Congo to include individuals or entities supporting the armed groups . . . through illicit trade of natural resources,; and (B)encourages member countries to ensure that companies handling minerals from the Democratic Republic of the Congo exercise due diligence on their suppliers, including— (i)determining the precise identity of the deposits from which the minerals they intend to purchase have been mined; (ii)establishing whether or not these deposits are controlled or taxed by armed groups; and (iii)refusing to buy minerals known to originate, or suspected to originate, from deposits controlled or taxed by armed groups. (9)The illicit trade by armed groups and militias in eastern Congo in columbite-tantalite (coltan), cassiterite, wolframite, and gold continues to flourish, fuels war, robs the people of Congo of a valuable and legitimate resource, and undermines the peaceful evolution of the Government of the Democratic Republic of the Congo. (10)Mineral derivatives from the Democratic Republic of the Congo are used in industrial and technology products worldwide, including mobile telephones, laptop computers, and digital video recorders. (11)In February 2009, the Electronic Industry Citizenship Coalition and the Global e-Sustainability Initiative released a statement asserting that— (A)use by the information communications technology industry of mined commodities that support conflict in such countries as the Democratic Republic of the Congo is unacceptable; and (B)consumer electronics companies can and should uphold responsible practices in their operations and work with suppliers to meet social and environmental standards with respect to the raw materials used in the manufacture of their products. (12)Companies that create and sell products that include columbite-tantalite (coltan), cassiterite, wolframite, and their derivatives, and gold have the ability to influence the situation in the Democratic Republic of the Congo by— (A)exercising due diligence over their manufacturing processes, ensuring they and their suppliers use raw materials in a manner that does not— (i)directly finance armed conflict; (ii)result in labor or human rights violations; or (iii)damage the environment; (B)verifying the country and mine from which the minerals used to build their products originate; and (C)committing to support mineral exporters from the Democratic Republic of the Congo that certify that their minerals do not— (i)directly finance armed conflict; (ii)result in labor or human rights violations; or (iii)damage the environment. (13)There are ample sources of columbite-tantalite (coltan), cassiterite, and wolframite in non-conflict areas of the Congo and worldwide; processing columbite-tantalite, cassiterite, and wolframite for commercial use requires sophisticated technology; there are a limited number of processing facilities worldwide for columbite-tantalite, cassiterite, wolframite, and their derivatives; and determining the sources of columbite-tantalite, cassiterite, wolframite, and their derivatives used by processing facilities has already been successfully done at low cost. (14)Article XX of the General Agreement on Tariffs and Trade provides that nothing in such Agreement shall be construed to prevent the adoption or enforcement by any contracting party of measures necessary to protect public morals. As such, the United States has the right to restrict the importation of goods that are harmful to the life and health of miners and others in the Democratic Republic of the Congo, including the importation of columbite-tantalite (coltan), cassiterite, wolframite, or their derivatives.
3.
Statement of policy
It is the policy of the United States, as affirmed by the Democratic Republic of the Congo Relief, Security, and Democracy Promotion Act of 2006 (Public Law 109–456; 22 U.S.C. 2151 note) and consistent with United Nations Security Council Resolution 1857 (2008), to promote peace and security in the eastern Democratic Republic of the Congo by supporting efforts of the Government of the Democratic Republic of the Congo, other governments in the Great Lakes Region of Africa, and the international community to— (1)monitor and stop commercial activities involving the natural resources of the Democratic Republic of the Congo that contribute to the activities of armed groups and human rights violations in the Democratic Republic of the Congo; and (2)develop stronger governance and economic institutions that can facilitate and improve transparency in the cross-border trade involving the natural resources of the Democratic Republic of the Congo in order to reduce exploitation by armed groups and promote local and regional development.
4.
Investigation, reports, and strategy regarding conflict minerals and human rights abuses in the Democratic Republic of the Congo
(a)
Congo conflict mineral-rich zones map, and armed groups
(1)
In general
Not later than 120 days after the date of the enactment of this Act, the Secretary of State, in consultation with the Secretary of Defense, shall, in accordance with the recommendation of the United Nations Group of Experts on the Democratic Republic of the Congo in their December 2008 report, work with other member states of the United Nations and local and international nongovernmental organizations to— (A)produce a map of mineral-rich zones and areas under the control of armed groups in the Democratic Republic of the Congo; (B)make such map available to the public; and (C)provide to the appropriate congressional committees, in classified form if necessary, an explanatory note describing in general terms the sources of information from which such map is based, the definition of the term control of armed groups utilized (for example, physical control of mines or forced labor of civilians, control of trade routes, and taxation or extortion of goods in transit), and the identification, where possible, of the armed groups or other forces in control of the mines depicted. (2)
Designation
The map required under this subsection shall be known as the Congo Conflict Minerals Map, and mines located in areas under the control of armed groups in the Democratic Republic of the Congo, as depicted on such Congo Conflict Minerals Map, shall be known as conflict zone mines. (3)
Updates
The Secretary of Defense, in consultation with the Secretary of State, shall update the map required under paragraph (1) not less frequently than once every 180 days until the Secretary of Defense certifies to Congress that no armed group that is a party to any ongoing armed conflict in the Democratic Republic of the Congo or any other country is involved in the mining, sale, or export of conflict minerals or gold, or the control thereof, or derives any benefits from such activities. (4)
Publication in Federal Register
The Secretary of State may add minerals to the list of conflict minerals. The Secretary shall publish in the Federal Register notice of intent to declare a mineral as a conflict mineral not later than one year before such declaration. (b)
Guidance for commercial entities
(1)
In general
The Secretary of State and the Secretary of Commerce shall work with other member states of the United Nations, local and international nongovernmental organizations, and other interested parties to provide guidance to commercial entities seeking to exercise due diligence, including documentation on the origin and chain of custody for their products, on their suppliers to ensure that conflict minerals used in their products do not— (A)directly finance armed conflict; (B)result in labor or human rights violations; or (C)damage the environment. (2)
Cooperation
The Secretary of State and the Secretary of Commerce shall work with commercial entities and other interested parties to identify best practices and opportunities to improve transparency of the supply chains of such commercial entities engaged in commerce or trade with products that contain one or more derivatives of conflict minerals. (c)
Strategy
(1)
In general
Not later than 180 days after the date of the enactment of this Act, the Secretary of State shall, working with the Administrator of the United States Agency for International Development, submit to the appropriate congressional committees a strategy to address the linkages that exist between human rights abuses, armed groups, and the mining of conflict minerals. (2)
Contents
The strategy required by paragraph (1) shall include the following: (A)A plan to assist governments plagued by conflict establishing and effectively implementing the necessary frameworks and institutions to formalize and improve transparency in the trade of conflict minerals. (B)An outline of assistance currently being provided to the Democratic Republic of the Congo and an assessment of future assistance that could be provided by the Government of the United States to help the Democratic Republic of the Congo to strengthen the management and export of natural resources. (C)A description of punitive measures that could be taken against individuals or entities whose commercial activities are supporting armed groups and human rights violations in the Democratic Republic of the Congo. (d)
Annual human rights reports
In preparing those portions of the annual Country Reports on Human Rights Practices under sections 116(d) and 502B(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 2151n(d) and 2304(b)) relating to the Democratic Republic of the Congo or countries that share a border with the Democratic Republic of the Congo, the Secretary of State shall ensure that such reports include a description of any instances or patterns of practice that indicate that the extraction and cross-border trade in conflict minerals has negatively affected human rights conditions or supported specific human rights violations, sexual or gender-based violence, or labor abuses in the eastern region of the Democratic Republic of the Congo, during the period covered by each such report. (e)
Annual organization for economic co-Operation and development investment committee report
In preparing the United States’ annual report to the Organization for Economic Co-operation and Development Investment Committee, the Secretary of State shall include a description of efforts by the United States to ensure, consistent with the Organization for Economic Co-operation and Development Guidelines for Multinational Enterprises, that enterprises under United States jurisdiction are exercising due diligence to ensure that their purchases of minerals or metals are not originating from mines and trading routes that are used to finance or benefit armed groups in the Democratic Republic of the Congo. (f)
Support of Mandate of United Nations Group of Experts on the Democratic Republic of the Congo
The President, acting through the Secretary of State, the United States Permanent Representative to the United Nations, and other appropriate United States Government officials, shall use the voice and vote of the United States at the United Nations Security Council to renew the mandate and strengthen the capacity of the United Nations Group of Experts on the Democratic Republic of the Congo to investigate links between natural resources and the financing of armed groups, and ensure that the Group of Experts’ recommendations are given serious consideration. (g)
Authorization of appropriations
There are authorized to be appropriated to the Secretary of State for fiscal year 2010 and each subsequent fiscal year for which the Secretary certifies to the appropriate congressional committees that a state of war is expected to continue to exist in the Democratic Republic of the Congo such sums as may be necessary to carry out this section.
5.
Sense of Congress on assistance for affected communities and sustainable livelihoods
(a)
Sense of congress on assistance for affected communities
It is the sense of Congress that the Administrator of the United States Agency for International Development should expand and better coordinate programs to assist and empower communities in the eastern Democratic Republic of the Congo whose livelihoods depend on the mineral trade, particularly— (1)communities affected by sexual and gender based violence; (2)communities affected by use of child soldiers and forced child servitude; and (3)individuals displaced and communities affected by violence. (b)
Sense of congress on future year funding
It is the sense of Congress that the Secretary of State and the Administrator of the United States Agency for International Development should work with the Committee on Foreign Affairs and the Committee on Appropriations of the House of Representatives and the Committee on Foreign Relations and the Committee on Appropriations of the Senate to increase assistance beginning in fiscal year 2010 for communities affected by violence in the Democratic Republic of the Congo, specifically to— (1)provide medical treatment, psychological support, and rehabilitation assistance for survivors of sexual and gender-based violence; (2)provide humanitarian relief and basic services to people displaced by violence; (3)improve living conditions and livelihood prospects for artisanal miners and mine workers; and (4)alleviate poverty by reconstructing infrastructure and revitalizing agricultural production. (c)
Sense of congress on coordination of assistance
It is the sense of Congress that the United States should work with other countries, on a bilateral and multilateral basis to— (1)increase protection and services for communities in the eastern Democratic Republic of the Congo at risk of human rights violations associated with the mineral trade, particularly women and girls; (2)strengthen the management and trade of natural resources in the Democratic Republic of the Congo; and (3)improve the conditions and livelihood prospects of artisan miners and mine workers.
6.
Identification of commercial goods containing conflict minerals
(a)
List of goods containing conflict minerals
Not later than 180 days after the date of the enactment of this Act and annually thereafter, the Secretary of Commerce, in cooperation with the Secretary of State, the International Trade Commission, and the Commissioner responsible for U.S. Customs and Border Protection, shall determine and publish in the Federal Register a list of those articles specified in the Harmonized Tariff Schedule of the United States that should be identified as likely containing conflict minerals. Such list shall be referred to as the Potential Conflict Goods List. (b)
Creating list of approved auditors
(1)
In general
Not later than one year after the date of the enactment of this Act and annually thereafter, the Secretary of Commerce, in cooperation with the Secretary of State, the International Trade Commission, and in consultation with nongovernmental organizations and manufacturing industry representatives, shall determine and publish in the Federal Register a list which contains a sufficient number of approved private sector auditing services qualified to audit the processing facilities worldwide of conflict minerals. (2)
Update
The Secretary of Commerce shall update the list required under paragraph (1) not less than once every 12 months and publish in the Federal Register the updated list. The Secretary of State shall work with and encourage relevant foreign governments to issue visas for auditors who are United States citizens for purposes of travel relating to auditing of processing facilities described in paragraph (1). (c)
Regular auditing of facilities for use of conflict minerals
(1)
In general
The Secretary of Commerce shall seek to ensure that facilities that process conflict minerals and whose resulting materials are used in products shipped into the United States subject themselves to random audits not less than every four months by private sector auditing services approved by the Secretary pursuant to subsection (b) to certify each such processing facility as either conflict mineral free or a conflict mineral facility. A processing facility certified as a conflict mineral facility is a facility that processes one or more conflict minerals. A processing facility certified as conflict mineral free is a facility that has not processed conflict minerals in the previous 4 months or since the previous audit. (2)
Audit reports
(A)
In general
The Secretary of Commerce shall seek to ensure that private sector auditing services approved by the Secretary pursuant to subsection (b) submit to the Secretary reports on the audits conducted by such services for those facilities that are audited pursuant to paragraph (1). (B)
Contents
The reports referred to in subparagraph (A) shall contain the following: (i)The name and location of the processing facility audited. (ii)The relevant minerals being processed at the facility. (iii)The date of the audit and the period covered by the audit. (iv)The date of notification of an impending audit. (v)The country of origin of minerals purchased and processed, including local areas or specific mines of origin in the Democratic Republic of the Congo from which minerals were sourced. (vi)A determination as to whether there were any minerals processed for which there is not a credibly documented and verifiable chain of custody. (vii)A declaration of the facility as one that is a Conflict Mineral Facility or is Conflict Mineral Free for the period covered by each such report. (3)
Publication in Federal Register
The Secretary of Commerce shall publish in the Federal Register the reports of private sector auditing services pursuant to paragraph (2) for those facilities that are audited pursuant to paragraph (1), including— (A)whether any such facility has been certified as conflict mineral free or a conflict mineral facility; and (B)if such service determines that the facility is a conflict mineral facility, the mine or local area of origin of the conflict minerals likely to have financed conflict in the Democratic Republic of the Congo. (4)
Additional audits
Processing facilities worldwide of conflict minerals may request additional audits from private sector auditing services approved by the Secretary pursuant to subsection (b). Any such additional audits shall be non-binding and may remain private. (d)
Auditing protocol and contents
(1)
In general
The Secretary of Commerce shall seek to ensure that, in carrying out audits in accordance with subsection (c) by private sector auditing services approved by the Secretary pursuant to subsection (b), such services follow an audit protocol that includes the following: (A)Determination of the mines of origin of processed materials. (B)Verification of the chain of custody of minerals obtained and processed during the preceding four months, to verify whether revenues from possession, sale, or taxation of conflict minerals are flowing to parties financing conflict in the Democratic Republic of the Congo. (C)Investigation of mineral sourcing and chain of custody in the Democratic Republic of the Congo and other countries, as necessary, to verify the information provided by suppliers. (2)
Timing of audits
Audits shall be randomly timed, but not without notice, in recognition of the rights of processing facilities worldwide and the sovereignty of the country in which they are located of conflict minerals.
7.
Requirements relating to importation of articles containing conflict minerals
(a)
Declaration of certain articles
(1)
In general
Beginning on the date that is one year after the date of publication in the Federal Register of the initial list of approved private sector auditing services under section 6(b)(1) or two years after the date of the enactment of this Act, whichever occurs later, importers that import articles specified in the Harmonized Tariff Schedule of the United States that are identified pursuant to section 6(a) as included on the Potential Conflict Goods List shall certify on the importer’s Customs declaration that such articles contain conflict minerals or are conflict mineral free in accordance with section 6(c). Articles that contain components using conflict minerals from a facility audited and certified by an auditor on the list referred to in subsection 6(b) as— (A)conflict mineral free shall be designated as conflict mineral free; and (B)a conflict mineral facility shall be designated as contains conflict minerals. (2)
Special rules
For the purposes of this Act— (A)recycled derivatives of conflict minerals shall be considered conflict mineral free; and (B)articles that contain only components sourced from processing facilities that are conflict mineral free may be labeled conflict mineral free. (b)
Prohibition on importation of certain articles
Unrefined conflict minerals, not including their derivatives from a conflict zone mine that is in raw or unrefined form for any commercial purpose may not be imported into the United States. Beginning on the date that is two years after the date of the enactment of this Act, articles made wholly or in part with components containing conflict minerals from facilities that have not been audited in accordance with section 6(c) may not be imported into the United States. (c)
Exemption
The President may exempt articles from inclusion on Potential Conflict Goods List and publish notice to this effect in the Federal Register, if the President— (1)determines that such an exemption is in the national security interest of the United States and includes the reasons therefor; and (2)establishes a date, not later than two years after the initial publication of such exemption, on which such exemption shall expire.
8.
Report by United States Trade Representative
(a)
In general
Not later than 180 days after the implementation of the requirements of sections 6 and 7 and every 180 days thereafter, the United States Trade Representative, in consultation with the Commissioner responsible for U.S. Customs and Border Protection, shall publish in the Federal Register a list of those importers that have imported into the United States articles that contain conflict minerals in the preceding 180-day period. (b)
Matters To be included
Each report required under subsection (a) shall, with respect to each importer identified under subsection (a), include the following information irrespective of whether any party to the importation has requested confidentiality: the carrier code, vessel country code, vessel name, voyage number, district/port of unlading, estimated arrival date, bill of lading number, foreign port of lading, manifest quantity, manifest units, weight, weight unit, shipper name, shipper address, consignee name, consignee address, notify party name, notify party address, piece count, description of goods, brand, manufacturing company, container number, and seal number.
9.
Penalties
(a)
Penalties relating to conflict minerals
If any person, by fraud, gross negligence, or negligence, enters, introduces, or attempts to enter or introduce any good that contains one or more conflict minerals (as such term is defined in section 11) into the territory of the United States by means of inaccurate information with respect to the imported good, such person shall be subject to penalties pursuant to section 592 of the Tariff Act of 1930 (19 U.S.C. 1592). (b)
Publication in the Federal Register
The Commissioner responsible for U.S. Customs and Border Protection and the Secretary of Commerce shall publish in the Federal Register in a timely manner a list of all penalties imposed under subsection (a).
10.
Reports by Government Accountability Office
(a)
Initial report
Not later than 36 months after the date of the enactment of this Act and annually thereafter, the Comptroller General of the United States shall submit to Congress a report that includes the following: (1)An assessment of the accuracy of the approved private sector auditing services under section 6. (2)Recommendations for such auditing services to— (A)improve the accuracy of such auditing services; and (B)establish standards of best practices. (b)
Follow-Up reports
Not later than 36 months after the date of the enactment of this Act and annually thereafter, the Comptroller General of the United States shall submit to Congress a report that includes the following: (1)An assessment of the effectiveness of the provisions of this Act. (2)A description of the problems, if any, encountered by the Department of Commerce, the Department of State, the Office of the United States Trade Representative, U.S. Customs and Border Protection, and the Administrator of the United States Agency for International Development in carrying out the provisions of this Act. (3)A description of the adverse impacts of carrying out the provisions of this Act, if any, on countries with columbite-tantalite (coltan), cassiterite, wolframite, or their derivatives, and in particular, communities in the eastern Democratic Republic of the Congo. (4)Recommendations for legislative or regulatory actions that can be taken to— (A)improve the effectiveness of the provisions of this Act to promote peace and security in accordance with section 3; (B)resolve the problems described in paragraph (2), if any; and (C)mitigate the adverse impacts described in paragraph (3), if any.
11.
Definitions
In this Act: (1)
Appropriate congressional committees
The term appropriate congressional committees means— (A)the Committee on Appropriations, the Committee on Foreign Affairs, the Committee on Ways and Means, and the Committee on Financial Services of the House of Representatives; and (B)the Committee on Appropriations, the Committee on Foreign Relations, the Committee on Finance, and the Committee on Banking, Housing, and Urban Affairs of the Senate. (2)
Armed group
The term armed group means armed groups identified as perpetrators of serious human rights abuses in the annual Country Reports on Human Rights Practices under sections 116(d) and 502B(b) of the Foreign Assistance Act of 1961 (22 U.S.C. 2151n(d) and 2304(b)) relating to the Democratic Republic of the Congo or countries that share a border with the Democratic Republic of the Congo. (3)
Conflict minerals
The term conflict minerals means columbite-tantalite (coltan), cassiterite, wolframite, or their derivatives, or any other mineral determined by the Secretary of State to be financing conflict in the Democratic Republic of the Congo. (4)
United States
The term United States means the customs territory of the United States, as defined in general note 2 of the Harmonized Tariff Schedule of the United States.
12.
Sunset
This Act shall expire on the date on which the President determines and certifies to the appropriate congressional committees, but in no case earlier than the date that is one day after end of the 2-year period beginning on the date of the enactment of this Act, that— (1)no armed group is a party to any ongoing armed conflict in the Democratic Republic of the Congo and is involved in the mining, sale, or export of one or more conflict minerals; or (2)a regional framework has been established and effectively implemented to monitor and regulate trade and commerce in conflict minerals so that such activities do not benefit armed groups in the Democratic Republic of the Congo.