On May 2, 2014, the Securities and Exchange Commission issued an order staying the effective date for compliance with the portion of the SEC’s conflict minerals rules that requires issuers to report to the SEC and disclose on their websites that certain products have “not been found to be ‘DRC conflict free.’” The order was issued in view of the ruling by the U.S. Court of Appeals for the D.C. Circuit on April 14, 2014 in National Association of Manufacturers v. Securities and Exchange Commission holding that this requirement violates the First Amendment, and formalizes the guidance on compliance with the SEC’s conflict minerals rules in light of the Court’s decision issued by the SEC’s Division of Corporation Finance on April 29, 2014.
For a discussion of the Court’s decision on the conflict minerals disclosures, please refer to our April 21, 2014 Client Alert titled “U.S. Court of Appeals Issues Ruling in Conflict Minerals Case” available here. For a summary of the guidance issued by the SEC’s Division of Corporation Finance on compliance with the conflict minerals rules, please refer to our April 30, 2014 Client Alert titled “SEC Issues Guidance on Conflict Minerals Rules” available here.
The order states that a stay of this aspect of the conflict minerals rules avoids the risk of First Amendment harm pending further proceedings and that the limited nature of the stay furthers the public’s interest in having issuers comply with the remaining requirements of the conflict minerals rules that were upheld by the Court. Issuers subject to the conflict minerals rules must file their Form SD and any required conflict minerals report on or before June 2, 2014.