A new alert from the law firm Bryan Cave states that the question of whether an Independent Private Sector Audit (IPSA) will be required for all CY2015 filers of Conflict Minerals Reports (CMR). The relevant text from the law firm’s alert:
At the PLI Securities Regulation Institute held last week, just days before the court’s ruling on the SEC’s petition for rehearing, Keith Higgins, Director of the SEC’s Division of Corporation Finance, stated that the April 2014 staff guidance would continue to apply during the pendency of the litigation and should be followed for conflict minerals reports to be filed in 2016. Mr. Higgins stated that timing issues would be taken into consideration by the SEC in connection with any changes, acknowledging the need for advance notice to issuers of a shift from existing guidance. Mr. Higgins addressed a question about the permissibility of an issuer labeling products as “DRC undeterminable” in reports to be filed in 2016. He stated that because the SEC is not requiring any label in connection with the rule, issuers may make their own decisions on using that label.
So it seems we have an answer. Hopefully an official announcement or statement will be issued by the Staff very soon, otherwise issuers will have to be comfortable relying on unofficial and essentially undocumented comments made at a legal conference. Not the most ideal way to communicate the Staff position on this important matter. But then again, this is more information on the conflict minerals disclosure rule as a whole that we have had since September 2014 (13 months ago), when Higgins made other unofficial and essentially undocumented comments at a legal conference, also never formalized or communicated by the SEC. Is this a trend, or just coincidence?
We will continue to monitor developments, although those may be as elusive as Big Foot.