<\/p>\n
On April 7, 2017, the SEC Division of Corporate Finance issued updated guidance<\/a><\/span> regarding the SEC\u2019s conflict minerals rules, stating that, in light of uncertainties regarding how the SEC will resolve issues relating to its conflict mineral rules, the SEC will not recommend enforcement action with respect to a company \u2013 even if it is subject to Item 1.01(c) of Form SD<\/a><\/span> \u2013 to comply with the disclosure obligations under the SEC\u2019s conflict minerals rules by only including in its Form SD the disclosures required by Items 1.01(a) and (b) of Form SD.<\/p>\n The SEC was prompted to update its guidance by the April 3, 2017 final judgment of the U.S. District Court for the District of Columbia in\u00a0National Association of Manufacturers, et al. v. Securities and Exchange Commission<\/em>,[1]<\/a> in which the court held that the provisions of Item 1.01(c) of Form SD that require companies to report to the SEC and state on their websites that a product has \u201cnot been found to be \u2018DRC conflict free\u2019\u201d violates the First Amendment of the U.S. Constitution.<\/p>\n <\/p>\n By way of background, Form SD generally requires the following:<\/p>\n In sum, a company that otherwise would have been required to file or post a Conflict Minerals Report with the SEC can comply with the SEC\u2019s conflict minerals rules by describing on Form SD its determinations regarding the origin and source of its necessary conflict minerals and the nature and results of its RCOI.\u00a0 Companies no longer will have to conduct the detailed due diligence or file with the SEC or post on their websites Conflict Mineral Reports as required by Item 1.01(c) of Form SD.<\/p>\n While the SEC noted that its updated guidance remains subject to further action by the SEC, is related to enforcement action only, and is not a statement of a legal conclusion, SEC Acting Chairman, Michael Piwowar, stated in a public statement<\/a><\/span> issued on April 7, 2017, that until the regulatory uncertainties regarding Item 1.01(c) are resolved, \u201cit is difficult to conceive of a circumstance that would counsel in favor of enforcing Item 1.01(c) of Form SD.\u201d<\/p>\n Companies should pay close attention to developments regarding compliance with the SEC\u2019s conflict minerals rules as the views of the SEC\u2019s commissioners and staff continue to evolve.<\/p>\n\n