IT 
EN 
On October 29, 2024, took place the digital event organized by Division IV “Policies for Small and Medium Enterprises, Startups, Cooperative Movement, Social Economy” of the Directorate-general for industrial policy, industrial crisis and reconversion, innovation, SMEs and Made in Italy (DGIND) - Department for Industial Policy of MIMIT - entitled “Due diligence requirements in the 3TG minerals and metals supply chain - Activities and initiatives of the National Competent Authority for the application of Reg. (EU) 2017/821”, mainly addressed to the Industry Associations of 3TGs importers and some institutional contact persons.
According to the provisions of the Decree of January 10, 2024 of the Minister of Enterprise and Made in Italy, on “Identification of non-general level executive offices of the Ministry of Enterprise and Made in Italy”,Division IV of DGIND also has among its competencies the one related to the management of the activities of National Competent Authority (Authority, ANC3TG) for the effective and uniform implementation of Regulation (EU) 2017/821 of the European Parliament and of the Council of May 17, 2017, laying down supply chain due diligence obligations for Union importers of tin, tantalum and tungsten, their ores, and gold, originating from conflict zones or high-risk areas (Regulation).
Dr. Paolo Casalino, Director General of DGIND recalled that, as of today, the Authority is engaged in preliminary activities to the launching of ex-post checks: some already completed (web platform for the management of ex-post checks, selection and training of dedicated staff, elaboration of ex-post checks programs, annual reports to the European Commission) and others in progress and completion. The activity of comparison and collaboration with the European Commission and other national authorities of the member states, participation in the Expert Group 3TGs (DGTrade) and other European and international fora continues steadily.
The Authority will soon be preparing to initiate ex-post checks proceedings that will be oriented towards a collaborative and awareness-raising method for the economic operators involved, aimed above all at the relevance of the dissemination and application of all EU and national legal principles and general requirements to be met regarding due diligence, which, moreover, are part of a broader path consistent with the competencies and activities of the DGIND and also include, for example, the directive on financial reporting and sustainability in global value chains, the regulation on forced labour, etc. These issues will become increasingly relevant, tracing even more explicitly the role and obligations of due diligence and the need for corporate commitment and compliance to now firmly established principles: for this reason, a collaborative orientation of the Administration may contribute in the future to properly balance the specific needs of all stakeholders, compliance with national and supranational regulations and directives, industrial activities and business competitiveness, which must also harmonize with the issue of administrative burdens that impact especially SMEs and, among them, smaller ones in particular.
In her introductory remarks, Dr. Picone, manager of DGIND - Division IV, highlighted how, in relation to the area of conflict minerals, the Division is called upon to verify and monitor over time that importers of 3TGs comply with the regulation and national legislation, actively supporting the Authority's action. It is crucial to pursue the objective of sustainable origin and responsible management of imported metals and minerals to ensure that they come from legitimate sources and are not associated with conflicts or actions attributable to the violation of human rights.
Therefore, the activity is embodied in the implementation of the ex-post check and audit activities, through which it is possible to ensure that the extraction, processing and trade practices of 3TGs do not compromise health, the environment and human rights, but instead contribute to the sustainable development of local communities by promoting transparency and traceability in the supply chain.
Confirming the Director's opening remarks, it was pointed out that the approach to be used must be based on trust between importers and consumers who must be allowed to make informed and conscious choices about the products they buy, and specifically, how awareness-raising and information activities on responsible social practices, highlighting their benefits for an ethical mineral supply chain are essential.
The institutional task of Division IV is, therefore, to support the realization of the Authority's commitment to the effective and uniform implementation of the regulation and to promote standards of responsibility and sustainability, thereby contributing to positive change in the 3TGs mining and importing sector.
Finally complementing the thoughts expressed by the Director, Dr. Picone pointed out that sustainability, which has now become a crucial issue for businesses in all sectors, can also give a reputational advantage and, therefore, that embracing sustainability represents not only an ethical responsibility but also a smart strategy for the future of one's business proving, in fact, to be a competitive advantage.
Dr. Raffaella Mastrella, officer of Division IV and representative of the ANC3TG Secretariat, presented the contribution “Application of Reg. (EU) 2017/821 and Legislative Decree No. 13/2021: reporting on institutional activities and implementation of ex-post checks of the Authority”.
After a brief introduction on the 3TGs and the related current regulatory framework (competencies of MIMIT institutional bodies, main EU and national acts, due diligence, technical tools and studies), an update was presented regarding the main institutional and participatory activities carried out by the Authority and the competencies and meetings held by the Committee for the coordination of ANC3TG activities (Committee) were outlined.
The preparatory activities for ex-post checks were mentioned, namely the collection of import data on an annual basis transmitted by the Customs and Monopolies Agency (ADM), of other useful data also coming from the competent national Authorities of other Member States, their analysis of which the method was illustrated that allows the Authority to define the list of importers subject to ex-post checks for each year, submitted to the Committee for obtaining its substantive opinion.
Examples were highlighted of the main updates that occurred from 2020 to 2024 of the indicative non-exhaustive list of CAHRAs ( conflict-affected and high-risk areas) countries, which, in the survey published in the third quarter of 2024, includes 27 countries and 220 regions.
Some general statistical data and the findings of the technical investigations carried out on the even and above-threshold customs declarations, registered at the time of the release for free circulation of minerals and metals (Annex I of the Regulation), related to importers with Italian EORI code, falling under the scope of the Regulation, in the years 2021, 2022 and 2023 (2023 still in a provisional assessment phase), as a result of which a list of 75, 64 and 74 “even and above-threshold” importers of 3TGs, respectively, was produced. The Authority subsequently applied a risk-based approach related to the origin of minerals and metals from CAHRAs countries, identifying a subset of importers for ex-post check activities.
An in-depth discussion was devoted to the method by which the Authority will follow up on the verifications through the application of the provisions of the March 17, 2022 Directorial Decree, and the issues related to the flow of information and requests to importers, the tools to be used by importers to respond to the Authority, the expected documentation, and the desired timelines for the conclusion of the administrative proceedings were explained.
Regarding the MIMIT human resources trained for this purpose and in charge of ex-post check activities, they were selected from among the officials in service at DGIND through a public comparative procedure and adequately trained through highly specialized training, carried out by professors who are experts in legal subjects and in current audit standards, representatives of multinationals and NGOs, figures with international relevance and with active roles in the European Commission.
Finally, at the end of the presentation, it was mentioned how, three years after its entry into force, the European Commission reviewed the functioning of the regulation. The resulting report was published on September 24, 2024: Dr. Mastrella reported on its main themes addressed, among which certainly emerges the need for more time, both for companies and for member states, for the regulation and the control mechanisms to reach the levels of effectiveness expected by the legislator.
Lawyer Lorenzo Mulazzi, who on behalf of ECC - Export Compliance Consulting - a professional services and consulting firm specializing in Export Compliance and Compliance that also delivered in the first half of 2024 the course on “Highly specialized training of persons entrusted by the National Competent Authority for the implementation of ex-post checks” organized by the Authority, in his presentation entitled “Risks in the supply chain of conflict minerals: obligations and tools for companies to identify, assess and mitigate them” has delved into the most relevant issues for the purpose of the implementation of ex-post checks of the ANC3TG.
This contribution traced the obligations prescribed by the regulation regarding the importation of 3TGs, with a focus related to the OECD Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, highlighting the crucial role of this document in the proper and specific implementation of the due diligence process for companies, the content of the Guide's annexes with examples of practical application and a detailed reminder of the contents of Recommendation 2018/1149 essential to develop and enhance the implementation of the due diligence pathway for importers, identify risk areas and the nature of risk indicators (red flags).
The speech concluded by representing how compliance with due diligence requirements is subject to audits by third parties, the results of which will then form a substantial part of the ex-post checks carried out by the Authority.
Eng. Francesco Cotroneo briefly presented the “popularizing video-pills” initiative, a series of 12 informational videos produced by ECC on behalf of the Authority on the contents of the Regulation and Legislative Decree No. 13/2021, which will soon be published on the Authority's website with the aim of informing importing companies, especially SMEs, on the main requirements and obligations to be met. They will hopefully help provide a basic level of understanding of the regulations and their implications, while also making it easier to learn both their language and sectoral terminology, the logic of their application, and the varied and specific tools available to activate and manage the due diligence process.
Dr. Lucia Pera, representing InfoCamere, illustrated the contribution dedicated to “Functionality and use of the IT platform for the management of the Authority's ex-post checks.”
The web platform, created for the purpose, allows the integral and computerized management by both the Authority and the companies importing 3TGs of the technical-administrative process of ex-post checks and can take advantage, in terms of facilitation of use and certainty of company data, of the full native interoperability with the Italian Business Register.
The various stages of the proceedings were briefly presented: initiation by pec communication from the Authority to the importer to be subjected to ex-post checks (year of detection, quantity of ore/metal imported, country of origin), stages of filling in the importer's digital form, uploading of documents by the company always guaranteed in terms of truthfulness and integrity by the affixing of the digital signature of the legal representative, possible request by the Authority for documental additions and/or application of corrective measures, conclusion with communication by the Authority of the outcome of the final proceedings, possible imposition of administrative sanctions.
For the purpose of understanding the functionality of the platform, importers will have at their disposal the operating manual that will guide and support them in the use of the platform.
The closing of the event was devoted to a short Q&A session.
Confindustria Federorafi, represented the need to avoid as far as possible duplication of bureaucratic burdens and costs for companies considering how the perimeter of the regulatory framework of Italian and European business activities is increasingly expanding and diversifying, for example, with recent EU measures such as CS3D and CSRD, “green claims” and AML-Anti Money Laundering. In this regard, therefore, the strengthening of synergies and coordination between the Authority and other ministries engaged in the aforementioned Committee for the Coordination of Activities to address this issue was envisioned.
A further request was to gather more information on the EU-wide mapping of the numerics of importers, particularly in the gold sector, and to monitor the multi-year trend of 3TGs flows, not limited to those between importers from EU member states and the origin of their purchases, but also including importers from third countries in order to understand whether and how supply routes have changed over time since the entry into force of Regulation 2017/821.
The issue regarding access to due diligence practices and compliance was also raised , especially for SMEs, which often face very significant costs in meeting the requirements of the regulation: in addition to possible and possible future economic support (i.e. incentives or vouchers for the costs of consulting, certification and employment in the specific due diligence activities of their own staff), a further proposal put forward was to be able to use and apply as soon as possible, following recognition by the European Commission, the schemes for the exercise of due diligence in the supply chain that have already been tested and have sufficiently established quality standards (i.e. RJC and LBMA) which, made available to importers, allow them a significant reduction in administrative costs.
For years now, Italian SMEs have been developing an awareness of due diligence, initially in metal suppliers and producers of semi-finished products, and more recently, particularly in the RJC context, also in companies in the various supply chains that will be equally subject to due diligence exercises and procedures even though they operate on a contract basis, receiving metals and processing them as subcontractors.
Concerning the effectiveness of the due diligence required of companies, the need for specific actions of increasingly structured institutional cooperation and support directly in CAHRAs, or otherwise “at risk” countries, to be implemented by the EU in order to achieve ever greater transparency, reliability and accessibility of information to be provided to importers, avoiding incentives, mainly, for elusive practices, was stressed.
The relevance of the reshoring phenomenon was also highlighted, which could also soon bring out the identification of new areas and new actors involved in the application of the regulation.
Pdf presentations:
-“Application of Reg. (EU) 2017/821 and Legislative Decree No. 13/2021: reporting on the institutional activities and implementation of ex-post checks of the Authority” - by the Authority
-“Functionality and use of the IT platform for the management of the Authority's ex-post checks” by InfoCamere