After four months of deliberations, the European Union agreed an outline deal late on Wednesday in Brussels on a law to clean up the commodities supply chain from gold and other metals from what are deemed to be conflict zones.
The gist of the deal is that EU importers are obliged to check the origin of the relevant raw materials to ascertain if they come from any conflict zone.
According to Reuters, Members of the European Parliament who brokered the deal said it would improve the lives of those living in conflict zones and marked a shift in the focus of trade law to supply chains.
In a brief to journalists, EU Trade Commissioner, Cecilia Malmstron, said: “We need to step up to our responsibilities and finally break the vicious cycle between the trade in minerals and the financing of conflict.”
Hailing the development, Bernd Lange, a German Social Democratic politician who took a lead role in the talks, commented: “It (the deal) opens the door for new momentum in trade policy.”
What is of note about the EU rules is that they will cover conflict minerals from anywhere in the world, with a bigger geographic scope than US Dodd-Frank legislation finalised in 2012. It is binding on raw materials, not finished products.
The glaring grey areas in the agreement, however, are that it does not cover finished products that have used raw materials from conflict zones. Due to this, human rights organisations have said the deal is not sufficient to stem flow of conflict minerals.