On Wednesday April 24 from 10am to 12pm, Société Miniere de Bisunzu (SMB) hosted a side session at the 13th OECD Forum on Responsible Mineral Chains. The purpose of the meeting was to provide an update to invitees regarding the recent decision to transition from their current provider to Better Sourcing Programme (BSP) as their chain of custody (CoC) and due diligence service provider, as well as to solicit feedback from the audience. As the largest tantalum producer in the Democratic Republic of Congo, the decision to change traceability provider has ramifications across the industry, notably the potential for increased competition and innovation amongst upstream due diligence service providers.
The panel was composed of representatives from the Congolese Mining Ministry, SMB, Better Sourcing Programme and the Responsible Minerals Initiative (RMI).
The meeting recognized the crucial role that the previous provider has played in providing an essential service to enable 3T exporters to provide assurances to international markets in the aftermath of the 2010 Dodd Frank Act. Nonetheless, continuing high costs of CoC and due diligence in eastern DRC, the need for increased monitoring and improved risk reporting, slow uptake of technology-based solutions and ongoing concerns around contamination of mineral lots were cited as reasons why increased competition should be considered a positive development.
They were further cited as the principle drivers behind the SMB decision to transition from their existing provider to the hire of BSP as their sole CoC and due diligence provider.
Specific innovations that the BSP system is claimed to provide were described as:
- Permanent monitoring of production at the site level (daily presence of BSP agents)
- Multiple monitoring agents introduced to adequately cover the size of SMB operations
- Introduction of technological solutions (electronic data input at site level, use of unique barcodes on tagged mineral lots etc.) to improve the integrity of data collection and flows, minimize the risk of false declarations and remove redundancies related to processing of due diligence data
- Rapid and up to date access to due diligence data gathered at the site level by way of an online portal
A number of benefits were said to accrue to SMB as a result; these include:
- Measurable decrease in minerals leakages between the point of production and the old tagging points (trading posts located 7km outside the SMB concession perimeter), saving the company significant losses from non-declared production
- Greater assurance that in-bound contamination of minerals with SMB’s own production are not occurring
- Reduced costs associated with the fulfillment of CoC and due diligence requirements
- Implementation of several risk mitigation measures since the beginning of BSP monitoring
In spite of these developments, the issue of an ongoing dispute between traceability and due diligence providers was raised both by the panel and from the floor. The overall consensus was that this should be resolved without delay, since it continues to affect both the capacity of exporters to sell their products on international markets and the cash flow of miners who must wait for payment for their production. SMB was said to have been unable to export between December 2018 and March 2019 due to the dispute; it only recommenced exports in April 2019.