U.S. Report on DRC Conflict Minerals Disclosure Rule

LUBUMBASHI, DEMOCRATIC REPUBLIC OF CONGO (Reuters) – A U.S. congressional watchdog has found no evidence that a 2012 Securities and Exchange Commission (SEC) conflict minerals disclosure rule has reduced violence in the Democratic Republic of Congo, according to a report released on Monday.

Armed groups continue to fight for control of gold mines in the eastern part of the Central African country, as noted by the U.S. Government Accountability Office (GAO). The report highlighted that the rule, requiring some companies to report on their use of tantalum, tin, tungsten, and gold, has likely had no effect in neighboring countries.

> "GAO found no empirical evidence that the rule has decreased the occurrence or level of violence in the eastern DRC, where many mines and armed groups are located," the report said.

Moreover, the GAO indicated that the rule was linked to an increase in violence, particularly around informal, small-scale gold mining sites. The challenge lies in the fact that gold is the most difficult mineral to trace and easiest to smuggle among the four minerals covered by the rule.

Congo is the world's leading producer of tantalum, a mineral considered critical by both the United States and the European Union.

The report also stated that the SEC disagreed with some of GAO's findings and raised concerns about specific aspects of its methodology and analyses. The GAO stated it made adjustments that did not materially affect its conclusions.

The SEC did not provide a comment when contacted. Last year, the GAO reported that some U.S. companies buying minerals from Congo and neighboring countries were not meeting disclosure requirements.

On September 30, Bintou Keita, head of the U.N. mission in Congo, stated to the U.N. Security Council that M23 rebels in the east are generating $300,000 per month in revenues in a coltan-mining region they seized earlier this year.