Europe can improve upon US's 'conflict minerals' legislation: ICG
(Read article summary)The European Union is debating how best to handle the issue of conflict minerals. International Crisis Group says it should not merely follow in the United States' footsteps, but go further.
Europe is up in the air about how to deal with what is coming out of the ground in conflict zones.
A year ago, the European Parliament asked the Commission to develop a European version of the Dodd-Frank legislation, which establishes disclosure regulations relating to the use of conflict minerals by companies, and was passed by the US Congress in July of 2010. However, in Brussels, skepticism persists as to whether any such measure will be enacted, and many wonder what added value Europe could bring in any case.
On one hand, the market reacted more quickly than expected to Dodd-Frank: importers officially distanced themselves from the minerals originating in the Kivus region of the Democratic Republic of the Congo; on the other hand, the Kivus economy is suffering, and the international mechanism of regulation which stands as the historical model, the Kimberley Process, is itself in dire straits. On balance, it would seem European policymakers have enough reasons at least to hesitate.
That would be the wrong conclusion, however. The real goal should not be to simply follow Dodd-Frank or “Europeanise” it. The EU’s version should go further by addressing the weaknesses of the American act – complementing regulation by the market with a political and developmental approach that is currently lacking.
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