Bill C-486: An Act respecting corporate practices relating to the extraction, processing, purchase, trade and use of conflict minerals from the Great Lakes Region of Africa

C-486 First Session, Forty-first Parliament, 60-61-62 Elizabeth II, 2011-2012-2013 HOUSE OF COMMONS OF CANADA BILL C-486 An Act respecting corporate practices relating to the extraction, processing, purchase, trade and use of conflict minerals from the Great Lakes Region of Africa first reading, March 26, 2013 NOTE 2nd Session, 41st Parliament This bill was introduced during the First Session of the 41st Parliament. Pursuant to the Standing Orders of the House of Commons, it is deemed to have been considered and approved at all stages completed at the time of prorogation of the First Session. The number of the bill remains unchanged. Mr. Dewar 411687 SUMMARY This enactment requires Canadian companies to exercise due diligence in respect of the exploitation and trading of designated minerals originating in the Great Lakes Region of Africa in seeking to ensure that no armed rebel organization or criminal entity or public or private security force that is engaged in illegal activities or serious human rights abuses has benefited from any transaction involving such minerals. Available on the Parliament of Canada Web Site at the following address:http://www.parl.gc.ca 1st Session, 41st Parliament, 60-61-62 Elizabeth II, 2011-2012-2013 house of commons of canada BILL C-486 An Act respecting corporate practices relating to the extraction, processing, purchase, trade and use of conflict minerals from the Great Lakes Region of Africa Preamble Whereas Canada recognizes that the illegal exploitation and trading of gold, cassiterite, wolframite and coltan and their derivatives, such as tin, tungsten and tantalum, can be directly linked to the fuelling of armed conflict and to the funding of armed groups engaged in illegal activities or serious human rights abuses in the Great Lakes Region of Africa; Whereas Canada recognizes that these conflicts have devastating impacts on the peace, safety and security of people in the countries of the Great Lakes Region of Africa; Whereas Canada strongly supports international efforts to fight the illegal exploitation and trading of natural resources, encourages transparency in relation to activities involving conflict minerals and is committed to preventing the extraction and trading of minerals from protracting or becoming a direct or indirect source of conflict, human rights abuses and insecurity; Whereas Canada believes that the responsible management of natural resources should enable countries to derive and sustain social and economic benefits from their natural resources; Whereas Canada officially supports the Extractive Industries Transparency Initiative, an international coalition of governments, companies, civil society groups, investors and international organizations that advocates for revenue transparency at the local level for mining, oil and gas industries; Whereas Canada is a signatory to the Organisation for Economic Co-operation and Development (OECD) Declaration on International Investment and Multinational Enterprises —which is implemented nationally by Canada’s National Contact Point for the OECD Guidelines for Multinational Enterprises — and, by extension, supports the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, which provides management recommendations for responsible global supply chains of minerals to help companies to respect human rights and avoid contributing to conflict through their mineral or metal purchasing decisions and practices; Whereas Canada has shown international leadership in promoting responsible supply chain management through its roles in developing the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas and the Kimberley Process regulating the international trade in diamonds; Whereas Canada has been instrumental in the establishment of the International Conference on the Great Lakes Region and supports its Regional Initiative on Natural Resources which aims to break the links between armed conflict and the illegal exploitation of natural resources; Whereas Canada has adopted Building the Canadian Advantage: a Corporate Social Responsibility (CSR) Strategy for the Canadian International Extractive Sector through which it commits to the promotion and support of corporate social responsibility for the Canadian extractive sector operating abroad, and encourages socially responsible corporate practices in all sectors and industries; Whereas the responsible management of natural resources may contribute to international development as defined by CIDA's Sustainable Economic Growth Strategy by contributing to a stable investment environment and by maximizing the availability of public resources to be reinvested in the welfare of local communities; Whereas promoting responsible management of natural resources can improve the competitive advantage of Canadian companies using minerals from the Great Lakes Region of Africa by further enhancing the reputation of Canadian industries, reducing supply chain risk and increasing transparency and accountability in the corporate operating environment; And whereas Canada is committed to encouraging the responsible exploitation of natural resources and strongly supports continued responsible investment in the mining economies of the Great Lakes Region and the responsible sourcing of the region’s minerals as a critical potential contributor to stability and development; Now, therefore, Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follow: SHORT TITLE Short title 1. This Act may be cited as the Conflict Minerals Act. INTERPRETATION Interpretation 2. The following definitions apply in this Act. “company”« entreprise » “company” means any corporation or legal person incorporated by or under an Act of Parliament or the legislature of a province, or a subsidiary of such an entity. “Department”« ministère » “Department” means the Department of Foreign Affairs and International Trade. “designated mineral”« minéral désigné » “designated mineral” means a mineral originating in the Great Lakes Region of Africa that is (a) gold, cassiterite, wolframite, coltan or any of their derivatives, such as tin, tungsten and tantalum; or (b) any other mineral or derivative specified by order of the Minister. “Great Lakes Region of Africa”« région des Grands Lacs africains » “Great Lakes Region of Africa” means the region of Africa that consists of Angola, Burundi, the Central African Republic, the Democratic Republic of the Congo, Kenya, Rwanda, Sudan, Tanzania, Uganda and Zambia, and any additional country specified by the International Conference on the Great Lakes Region. “illegal activity”« activité illégale » “illegal activity” means (a) any illegal activity that is intended to undermine or overthrow a legitimate government by violent means; and (b) the illegal engagement in or profiting from the extraction, trade or transport of a designated mineral. “International Conference on the Great Lakes Region”« Conférence internationale sur la région des Grands Lacs » “International Conference on the Great Lakes Region” means the intergovernmental organization of countries in the Great Lakes Region of Africa, the members of which are Angola, Burundi, the Central African Republic, the Republic of Congo, the Democratic Republic of Congo, Kenya, Uganda, Rwanda, Sudan, Tanzania and Zambia. “Minister”« ministre » “Minister” means the Minister of Foreign Affairs. “non-state armed group”« groupe armé non étatique » “non-state armed group” means an armed rebel organization or other armed criminal entity. “OECD”« OCDE » “OECD” means the Organisation for Economic Co-operation and Development. “public security force”« force de sécurité publique » “public security force” means a lawful armed unit that is part of an army or a police force or other national force. “private security force”« force de sécurité privée » “private security force” means an armed individual or group of individuals employed or hired to provide private security services. “serious human rights abuse”« graves violations des droits de la personne » “serious human rights abuse” includes (a) any form of torture or other cruel, inhuman or degrading treatment; (b) any form of forced or compulsory labour; (c) child labour; (d) sexual violence and any other gross human rights violation; and (e) war crimes, crimes against humanity, genocide and other serious violations of international humanitarian law. “supply chain”« chaîne d’approvisionnement » “supply chain” means the system that includes all of the activities, organizations, actors, technology, information, resources and services involved in moving a designated mineral from the extraction site to its incorporation in the final product for end consumers. “supply chain policy”« politique relative à la chaîne d’approvisionnement » “supply chain policy” means the policy described in the document entitled Model Supply Chain Policy for a Responsible Global Supply Chain of Minerals from Conflict-Affected and High-Risk Areas, as set out in Annex II of the OECD document entitled Due Diligence Guid-ance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, as amended from time to time. DUE DILIGENCE Requirement of due diligence 3. (1) A company must exercise due diligence in respect of any extraction, processing, purchasing, trading in or use of designated minerals that it carries out in the course of its activities, or that it contracts to have carried out. For greater certainty (2) For greater certainty, the requirement to exercise due diligence applies as soon as a company commences any of the activities referred to in subsection (1) and continues until those activities have been completed. Exercise of due diligence (3) For the purposes of this Act, the exercise of due diligence means conforming to the supply chain policy and includes, but is not limited to, (a) the establishment of strong company management systems by, for example, adopting and committing to the supply chain policy for designated minerals and strengthening the company engagement with suppliers; (b) the identification of any risk that the supplier is sourcing from, or is directly or indirectly linked to, any non-state armed group or any public or private security force that is engaged in illegal activity or serious human rights abuse, and an assessment of the level of the risk; (c) the design and implementation of strategies to respond to any identified risk by, for example, immediately suspending or discontinuing engagement with a supplier; and (d) carrying out an independent third-party audit of the company’s due diligence practices. ANNUAL REPORT Report to Minister 4. If a company has, during a fiscal year that commences after the date on which this Act comes into force, processed, purchased, traded in, used or extracted a designated mineral, or contracted to do so, the company must, within 60 days after the end of that fiscal year, submit to the Minister and publish on its website (a) a report that specifies the measures taken by the company to exercise due diligence in respect of the source and supply chain of designated minerals; (b) an independent third party audit of the report that has been conducted in accordance with the supply chain policy and the particulars of the entity that conducted the audit; (c) a description of any use by the company of the designated mineral and of any products containing the designated mineral that were manufactured, or contracted to be manufactured, by the company; (d) a description of any commercial and financial transactions that have occurred in relation to the designated mineral to which the company was a party; (e) if applicable, a description of the facilities used by the company to process the designated mineral; (f) the country of origin of any such designated mineral; and (g) a detailed description of the efforts made to determine the mine or location of origin of the designated mineral and the results of those efforts. Publication by Minister 5. Upon receiving a report referred to in section 4, the Minister must (a) publish it on the departmental website and cause it to be laid before both Houses of Parliament; and (b) share the report with the government of every country from which the reporting company obtained designated minerals during the fiscal year to which the report relates. Published under authority of the Speaker of the House of Commons