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Experts share opinions on Conflict mineral legislation at VICENZAORO Winter
The discussions touch upon the Dodd-Frank Act and similar legislations
By: Diamond World News Service
Jan 28 2014 1:49PM
Reference: 8769  

A seminar entitled "Conflict mineral legislation in the Europe and the United States: How it impacts upon both the domestic and export jewellery business", held during the VICENZAORO Winter trade fair, brought to the fore many insights on the subject, led by a blue-ribbon panel of experts.

The experts discussed this issue in light of the legislative processes targeting minerals from conflict areas in the Great Lakes region of Africa. The event was hosted by Fiera di Vicenza; CIBJO, the World Jewellery Confederation; the Responsible Jewellery Council; and Confindustria Federorafi and presented by Corrado Facco, Managing Director of Fiera di Vicenza, and Gaetano Cavalieri, President of CIBJO.

The first of the two specific pieces of legislation under the spotlight was Section 1502 of Dodd-Frank Act in the United States. The Act was signed into law in 2010, and is a disclosure requirement, in which publicly traded companies are to determine whether their products contain conflict minerals and conduct inquiries into country of origin of those minerals. Starting, this year, they need to make formal disclosures to the Securities and Exchange Commission (SEC).

Corrado Facco, noted that with the Act, ‘quite a significant percentage of the jewellery traded in the United States will end up in the display cases of publicly traded companies. In other words, if you export or are looking to export to the United States, it is more than likely that, ultimately, Dodd-Frank will matter to you’.

A legislation similar to the Dodd-Frank Act is pending in the European Union, while in Brussels, the European Commission's Directorate-General for Trade is almost finally putting together a legislative proposal that may parallel Dodd-Frank, though it intends to be more on the lines of international initiatives like the OECD Due Diligence Guidance.

The pervasiveness of Dodd-Frank was confirmed by Philip Olden, of Signet. "If you are not able to demonstrate that you can meet our requirements, we will not be able to buy from you," he said. Marieke van der Mijn of Responsible Jewellery Council (RJC) opined the critical juncture for due diligence in the supply chain to be the gold refineries and disputed the notion that the assurance was a luxury only available to larger companies as 40 percent of RJC's members are small and medium-sized enterprises.

Questioning the legislative, as being justified, Michael Allchin of Birmingham Assay Office and the President of the CIBJO Precious Metals Commission, shared that maybe voluntary systems like the OECD Due Diligence Guidance, would be more efficient. He noted that while it is the easiest way to comply is to ‘not to buy gold from Africa's Great Lakes region’ but this in turn is creating devastating damage to the ‘local communities, many of which do not have alternative means of a livelihood’.

Speaking on behalf of the Italian government, Maria Benedetta Francesconi addressed that the cost invoilved and the task of verifying the movement of gold though the pieple was not a simple one and this can be difficult upon small and medium sized enterprises, who make up the bulk of the local jewellery sector. “By placing another substantial burden upon the industry we are again raising the bar of entry. We have to develop systems by which all participants in this industry are reasonably able to meet the requirements of due diligence,”Maria stated.

In closing, Gaetano Cavalieri mentioned that “Above all we need to consider the commitment we have as members of a responsible business community to society.” He opined that if the industry avoided ‘trading with the central African gold producers because it is the easiest way to achieve compliance, then we may have avoided doing the wrong thing, but we certainly did not do the right thing."

The seminar was opened by Fiera di Vicenza's new president Matteo Marzotto, who noted his organisation commitment to serving both the Italian and international jewell

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