# Dodd-Frank Section 1502 The most interesting regulatory experiment in this vault, because it tried something genuinely novel and the evidence about whether it worked is genuinely contested — and because it is the cleanest available case of **deregulation by non-enforcement**. ## The design Signed **21 July 2010** as part of the Dodd-Frank Act, Section 1502 added Section 13(p) to the Securities Exchange Act. It does **not ban anything**. Any SEC issuer for which tin, tungsten, tantalum or gold are "necessary to the functionality or production" of a product must annually disclose whether those minerals originated in the DRC or an adjoining country, and if they might have, must conduct supply-chain due diligence and file a Conflict Minerals Report — originally including an independent private-sector audit. The theory was **regulation by sunlight**: forced disclosure would let consumers, investors and advocates apply pressure without the government prohibiting anything. That made it a landmark test of whether mandated transparency can substitute for direct regulation — the same family as the climate and ESG disclosure mandates that came later, which is why the fight over it has always been about more than minerals. The SEC's final rule (August 2012, adopted **3–2 on party lines**) built a three-step architecture: applicability, a **Reasonable Country of Origin Inquiry**, and then due diligence following a recognised framework — in practice the [[OECD Due Diligence Guidance]] — reported on the new Form SD. Ten covered countries. SEC cost estimate: $3–4 billion initial, $206–609 million annually. ## What the courts did ***National Association of Manufacturers v. SEC*** (D.C. Cir. 2014, reaffirmed 2015) struck down **exactly one thing**: the requirement that an issuer describe its products as **"not been found to be 'DRC conflict free.'"** Judge Randolph reasoned that "conflict free" is "a metaphor that conveys moral responsibility," not a purely factual statement, and that compelling it forces a company to "confess blood on its hands." Judge Srinivasan dissented, arguing the descriptor was factual sourcing information. **Everything else survived.** The court rejected all the APA and Exchange Act challenges — no de minimis exception, the "contract to manufacture" extension, the phase-in periods, and the cost-benefit analysis ("the agency need not measure the immeasurable"). The RCOI, the Form SD obligation, the due-diligence requirement and the audit all withstood judicial review. Only the compelled *characterization* fell. That boundary — **compelled moral characterization fails the First Amendment, compelled process disclosure survives** — is the doctrinal line for every ESG disclosure mandate since, and is the reason this case matters far beyond the Congo. ## The hollowing On **7 April 2017** the SEC's Division of Corporation Finance announced it would not recommend enforcement against companies filing only the RCOI portions of Form SD — dropping the due-diligence report — and Acting Chairman Piwowar directed staff to prepare a recommendation for future action. **That recommendation was never produced.** The independent audit had already been stayed in 2014. Net effect, still operative in 2026: **the statute is law, the rule is on the books, the audit is stayed, the due-diligence report is unenforced.** Companies file the inquiry and its results. Most voluntarily file the report anyway. This is the pattern the vault documents at the [[Toxic Substances Control Act]] and elsewhere — a rule neutralised without being repealed, its enforcement quietly evaporating while the text remains as evidence that something is being done. See [[Regulatory Capture]]. ## Does it work? The honest answer > [!warning] Both sides of this literature are real, and the popular version of each is wrong > **The critique.** Laura Seay's 2012 CGD paper coined "de facto embargo" — buyer risk-aversion producing a boycott the statute never mandated, with 1–2 million artisanal miners affected. Séverine Autesserre's "Dangerous Tales" argued the whole intervention rested on a mis-specified causal narrative. Stoop, Verpoorten and van der Windt (PLOS ONE, 2018) found that in gold-mining territories, battles rose 44%, looting 51% and violence against civilians 28%. > > **The support.** Baik, Even-Tov, Han and Park (*Journal of Accounting Research*, 2024) found the regulation decreased conflict in covered mining regions and reduced conflict sensitivity to price spikes. An IPIS/UCLA matched study of 104 mine sites found **27% less army presence and taxation** in due-diligence areas — though also 58% *more* civilian-government taxation, and no improvement in how secure households felt. IPIS surveys found 79% of 3T miners at mines with no armed-group involvement by 2016, against a 2010 baseline where almost every deposit was militarised. > > **Where they converge.** 3T supply chains became measurably more traceable and less militarised; **gold got worse** — portable, fungible, effectively outside the regime; artisanal incomes took a real hit; and the statute never touched the actual drivers (land, citizenship, security-sector reform, Rwandan involvement). > > And note who was not consulted in the popular telling: in 2017, **111 Congolese and Great Lakes organisations** wrote to the SEC opposing suspension. ## The repeal push, 2024–2026 **October 2024** — GAO-25-107018 finds no evidence the rule reduced violence and a spread of violence around gold sites. This is the evidentiary hinge for everything after. **15 January 2026** — Rep. Bill Huizenga introduces **H.R. 7085**, striking Section 13(p) outright. **22 January 2026** — ordered reported by House Financial Services **by 30–24**, the furthest any repeal has advanced since 2017; formally reported as amended and **placed on the Union Calendar, No. 481, on 19 March 2026.** No floor action since. **3 April 2026** — the National Association of Manufacturers petitions the State Department to invoke the statutory termination or waiver provision, citing fifteen years of failure and industry cost estimates of $9.4–16 billion. **3 June 2026** — House Financial Services leadership writes to the President asking him to "revise, waive, or terminate" the requirements, arguing the regime has **"weakened U.S. access to critical mineral supply chains"** and let Beijing strengthen its position in central Africa. That last argument is what makes 2026 different from 2017. The case against conflict-minerals disclosure is no longer primarily about compliance cost. It is that human-rights due diligence is a strategic liability in a minerals race with China — the [[Critical Minerals]] framing beating the human-rights framing on its own ground. > [!note] Status as of August 2026 > **Not repealed.** H.R. 7085 sits on the Union Calendar and has not passed the House; no Senate companion has been identified. **No presidential waiver or termination certification has issued**, and neither State nor the White House has publicly responded to the April and June requests. The SEC has proposed nothing. Form SD filings proceeded normally on 1 June 2026. A **20 July 2026 executive order** tightened critical-minerals provenance tracing for defence contractors — adjacent to this fight, but it does not touch §13(p). > > The rule is legally intact and operationally hollow. Live status tracked at [[Conflict Minerals Watchlist]]. ## See also [[Conflict Minerals Supply Chain]] · [[Kimberley Process Certification Scheme]] · [[OECD Due Diligence Guidance]] · [[Regulatory Capture]] · [[Conflict Minerals Hub]]