Recycled or Scrap Materials

Under Dodd-Frank Section 1502 and SEC Rule 13p-1, conflict minerals from recycled or scrap materials are exempt from the requirement to conduct supply chain due diligence beyond reasonable inquiry. ‘Recycled minerals’ are reclaimed end-user or post-consumer products, or scrap processed metals created during product manufacturing. If a company’s RCOI determines that all conflict minerals in its products come from recycled or scrap sources, it can state this in its Form SD without filing a Conflict Minerals Report.

Dodd-Frank Act Section 1502; SEC Rule 13p-1; Exchange Act Release No. 34-67716 (August 22, 2012), pages 47–54.

The recycled/scrap exemption is meaningful for certain industries. Gold recycled from electronics, tin recovered from solder waste, and tantalum recovered from capacitor manufacturing scrap can qualify. Companies must make a reasonable inquiry to confirm that minerals are actually from recycled/scrap sources. This typically requires supplier attestation and documentation. The CMRT includes fields for suppliers to indicate recycled/scrap sourcing.

A precious metals refinery processes gold exclusively from recycled electronics and jewellery scrap. It provides written attestation with supporting process documentation confirming 100% recycled inputs. A manufacturer sourcing gold from this refinery can state in its Form SD that conflict minerals come from recycled sources, avoiding the CMR filing requirement.