CONFLICT MINERAL POLICY STATEMENT OF YUNNAN TIN COMPANY LIMITED
Yunnan Tin Company Limited is the world’s largest tin producer with facilities to explore, mine, concentrate, smelt, and also to downstream process tininto products such as chemicals and solder, as well as facilities to recycle tinsecondary materials. Our cassiterite is generally sourced from our own concessions and other mines within China with portion of imports from Myanmar, and we also source secondary materials inside Chinafor recycling. Yunnan Tin Company Limited owned two tin smelters, they are: Smelting Branch of Yunnan Tin Company Limited with CFSP CID002180(Add: No. 1 Yelian Road, Gejiu, Yunnan, P.R.China) , and Chenzhou Yunxiang Mining and Metallurgy Co.,Ltd with CFSP CID000228 (Add: Shegutian Group,Xiaducun, Qiaokou Town,Suxianqiao District, Chenzhou, Hunan,P.R.China)
根据2010 年7 月21 日生效的《多德—弗兰克华尔街改革和消费者保护法案》第1502 节规定：“冲突矿物”包括锡石及其衍生物，同时还有其它两种矿物和黄金。公司支持这项法案所要达成的目标，也从未与刚果民主共和国东部省份有关冲突采矿行业联系，并将认可此项法律对于在美国证券交易所的上市公司所做的相关披露要求。
Section 1502 of the US Dodd-Frank Wall Street Reform and Consumer Protection Act effectiveon July 21st 2010 defines ‘Conflict Minerals’ as including ‘cassiterite and its derivatives’ along with two other minerals and gold. Yunnan Tin Company Limited generally supports the objectives of this law and has no link between mining and conflict in the eastern Provinces of the Democratic Republic of Congo (DRC), and recognize the disclosure requirements which this law imposes on SEC reporting companies in the US.
Our tin business partly involves the purchase and treatment of secondary materials that we obtain from end-of-life materials, by-products or intermediate productsfrom Chinese suppliers. We also consider our tin recycling business to be an important and positive contribution to the sustainable management of natural resources and an activity that should be promoted.In theprocess of sourcing, we require commitment by our suppliersthat their materials shalloriginate inconflict-freeminerals. Otherwise, we will terminate sourcingimmediately.
Both the Organisation for Economic Co-operation and Development (OECD) and the United Nations (UN) have released broadly similar guidelines for company due diligence on minerals from conflict affected and high risk areas, and in the case of the UN, specifically for the DRC. TheOECD guidance encourages companies to draw upon it as they establish their due diligence practices, andthe guidance aims to promote responsible sourcing by incorporating the flexibility to allow trade to continue.
We have assessed our sources and suppliers of minerals according to the ‘red flag’ criteria contained in the OECD guidance and consider that the need for further due diligence is not required. Our company does not source cassiterite from the DRC or adjoining countries.
We are engaged in the Conflict Free Smelter Programme and participate in auditing processes to provide assurance for our customers that our tin ingot and products are from sources not linked to conflict.
RELEVANT COMPANY AND ASSOCIATION ACTIONS
Although not sourcing cassiterite from the DRC or adjoining countries, we have made relevant personnel within our company such as smelter managers and mineral purchasers aware of the ‘conflict minerals’ law of the US, as well as the ‘red flag’ criteria of the OECD guidance. We have also made our suppliers aware of these criteria and have included relevant text in our supply contracts.
We also communicate this policy to our customers and publicly through other channels such as our company website.
We recognized issues with tin supply from the DRC and committed, as a member of the global tin association ITRI, to a policy on artisanal and small scale mining. This was followed in October 2009 by the ITRI Member Declaration on Artisanal and Small Scale Mining that included a commitment by each member company not to purchase cassiterite known or suspected to have originated in the DRC unless participating in, and complying with, the current requirements of the ITRI Tin Supply Chain Initiative (iTSCi).
Our company has not, and is not purchasing cassiterite from the DRC and/or adjoining countries, since that is not part of our business model. However, we fully support the aims of the iTSCi programme to differentiate between minerals trade that may be funding conflict, and the trade that is not, in order to allow artisanal mining to continue when possible, and to avoid a complete embargo on the region. We consider that ‘conflict minerals’ can most effectively be controlled at source, rather than at the point of smelting.
We note that the iTSCi programme references the OECD guidance in membership documents and aims to support the recommendations of the OECD, in particular Annex II, the ‘model supply chain policy for a responsible global supply chain’. Should we source cassiterite from the DRC or adjoining countries in the future we will do so through the iTSCi system and therefore while recognising Annex II of the OECD guidance.
ITRI has worked as a key participant in the OECD multi-stakeholder working group to develop the guidance document since December 2009 on behalf of member companies.
ITRI holds Memoranda of Understanding, and works closely with the Governments of the DRC, Rwanda, and Burundi, as well as the ICGLR (International Conference of the Great Lakes Region) who all recognise the iTSCi due diligence system as appropriate for use in their countries.
ITRI has also participated in discussions with relevant offices of US Congress and a roundtable hosted by the SEC, and is participating in consultations regarding a possible EU strategy on ‘conflict minerals’.
ITRI has also supported and worked with the Global e-Sustainability Initiative (GeSI) and Electronic Industry Citizenship Coalition® (EICC) since early 2009 and has provided advice to improve the conflict-free smelter (CFS) programme, also on behalf of member companies.
Through a combination of these efforts, and in close co-operation with Governments and NGOs, despite having no direct involvement in purchasing from the DRC, but as a leading member of the tin production industry, our company therefore aims to contribute to the achievement of two goals:
Minimising the trade in cassiterite that directly or indirectly finances or benefits armed groups in the DRC and/or adjoining countries, and;
Promoting ways for legitimate minerals from the region to enter the global supply chain, thereby supporting the economy of the region and the local communities that depend on this trade.
We recognize that implementation of due diligence frameworks, such as those outlined in the OECD guidance, will take time, and will present challenges as many of the mechanisms needed to facilitate transparency for in-region sourcing, such as the iTSCi project, are developed. We also acknowledge that these due diligence frameworks will likely continue to evolve and develop, particularly following the publication of the SEC rules.
Theintention of the supply chain should be to facilitate and promote improved governance, peace and stability, respect for human rights, economic development, and improved livelihoods in the DRC and adjoining countries.
However, “international demand for Congolese minerals is currently low. This downturn stems from a restrictive interpretation of Dodd-Frank’s requirements by some industry players. It has serious implications for miners and their families, and is not an outcome that is in the interest of anyone with a stake in ending the conflict, easing the suffering and building a peaceful and prosperous Congo,”as recently reported by leading sustainability and advocacy groups.
Due diligence frameworks and mechanisms can only be developed when trade is continuing. We urge all participants in the supply chain to recognize the potential for negative impacts of their own purchasing decisions and to assist the tin production industry as we work jointly towards a lasting solution for sustainable cassiterite production in the DRC and the adjoining countries.
Date: May 27th, 2016
Name of responsible person: Ms. Yang Yimin
General Manager of Yunnan Tin Company Limited