TANTALUM-NIOBIUM INTERNATIONAL STUDY CENTER

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Conflict Affected and High-Risk Areas (CAHRAs)

Tantalum- and niobium bearing minerals are located in many countries around the world. The nature of conflict is constantly changing, while some conflicts may be country-wide, many conflict-related and high risk incidents are concentrated on a regional or local level, or involve individual sites/entities/actors. Over time there is a changing pattern of conflict affected and high risk areas (CAHRAs) and this can result in a mine becomming considered to be located in a CAHRA.

 

What is a CAHRA?

Under the EU Conflict Mineral Regulation (due to come into force on 1st January 2021) the definition of CAHRAs is "Areas in a state of armed conflict, fragile post-conflict areas, as well as areas witnessing weak or non-existing governance and security, such as failed states, and widespread and systematic violations of international law, including human rights abuses".

Similarly, the OECD Due Diligence Guidance definition of conflict-affected and high-risk areas: Conflict-affected and high-risk areas are identified by the presence of armed conflict, widespread violence or other risks of harm to people. Armed conflict may take a variety of forms, such as a conflict of international or non-international character, which may involve two or more states, or may consist of wars of liberation, or insurgencies, civil wars, etc. High-risk areas may include areas of political instability or repression, institutional weakness, insecurity, collapse of civil infrastructure and widespread violence. Such areas are often characterised by widespread human rights abuses and violations of national or international law.

Both country risk assessments and individual supplier due diligence are critical to ensure responsible sourcing of minerals.

The T.I.C. does not generate a definitive list of CAHRAs.

 

How to decide if a country is a CAHRA?

Both country risk assessments and individual supplier due diligence are critical to ensure responsible sourcing of minerals. 

  • The EU is in the process of developing a non-definitive list of CAHRAs. They have extensive guidance here.
  • The European Commission has published their non-binding guidelines for the identification of conflict-affected and high-risk areas and other supply chain risks here.
  • The RMI also provides guidance here.
  • Heidelberg Conflict Barometer – presence of armed conflict
  • Control Risk Worldmap – security and political risks
  • INFORM worldmap – humanitarian crisis (not limited to conflict or security issues)

 

What does 'due diligence' mean?

The EU says that 'due diligence' means acting with reasonable care and investigating an issue before making a decision.  In other words, it is an on-going, proactive and reactive process through which companies put in place systems and processes to make sure they are able to identify, manage and report on risks in their supply chain. For the minerals which the regulation covers (tin, tantalum, tungsten and gold) it means companies must check that what they buy is sourced responsibly and does not contribute to conflict or other related illegal activities.

Companies that practise due diligence first check how risky it is to source raw materials from a fragile or conflict-affected area. They assess the likelihood that those raw materials could be financing conflict, forced labour or other risks set out in the regulation.

By checking their supply chains, they can then make sure that they manage those risks responsibly.

 

How does the new EU system of due diligence work?

EU importers of tin, tantalum, tungsten and gold must check what they are buying, to ensure it has not been produced in a way that funds conflict or other related illegal practices.

The regulation requires importers to follow a five-step framework which the Organisation for Economic Co-operation and Development (OECD) has laid out in a document called 'Due Diligence Guidance for Responsible Supply Chains from Conflict-Affected and High-Risk Areas' (OECD Guidance).

In brief, these steps require an importer to:

  • establish strong company management systems

  • identify and assess risk in the supply chain

  • design and implement a strategy to respond to identified risks

  • carry out an independent third-party audit of supply chain due diligence

  • report annually on supply chain due diligence.

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