Conflict minerals contained in a product's packaging will generally not trigger the rule. For example, if an issuer manufactures a package or container that contains a conflict mineral and uses the package or container in the display, transport or sale of a product the issuer also manufactures, the conflict mineral necessary to the functionality or production of the package or container is not considered necessary to the functionality or production of the product. Only a conflict mineral that is contained in the product itself would be considered necessary to the functionality or production of the product. If, however, an issuer manufactures and sells packaging or containers independent of the product, the packaging or containers, in that circumstance, would be considered a product (Question 6).

Equipment used to provide services is not a product under the rule. Issuers that manufacture or contract for the manufacturing of equipment they use in providing a service they sell are not required to report on the conflict minerals in that equipment if the equipment:

For example, issuers that operate cruise lines are not required to file reports regarding the conflict minerals in the cruise ships they manufacture or contract to have manufactured (Question 7).

The phase-in period for acquired companies is also available to new IPO companies. Instruction 3 to Item 1.01 of Form SD permits a new IPO issuer to start reporting under the conflict minerals rule beginning with the first reporting calendar year that begins no sooner than eight months after the effective date of its IPO registration statement (Question 11).

Failure to timely file a Form SD regarding conflict minerals does not cause an issuer to lose Form S-3 eligibility (Question 12).

A company that provides only services associated with the exploration, extraction, processing and export of a resource is not considered a resource extraction issuer. For example, neither companies that provide hardware and logistics to help companies explore for or extract resources nor companies engaged by an operator to provide hydraulic fracturing services or drilling services for the operator would be considered resource extraction issuers (Question 2).

An issuer providing only transportation of a resource without an ownership interest in the resource is not considered to be a resource extraction issuer. The definition of commercial development in Rule 13q-1 includes export but does not include transportation activities. If the issuer has an ownership interest in the resource it is transporting, the staff would view the issuer as a resource extraction issuer (Question 4).

Penalties and fines related to resource extraction paid to government agencies are not reportable as fees (Question 6).

A resource extraction issuer is required to disclose payments made to governments to further its commercial development activities and is not required to disclose other payments made to those governments. An issuer may elect to segregate income from exploration, extraction, processing and export from income earned on other business activities in a particular country and disclose income taxes paid solely on the income generated by the commercial development activities (Question 8).

The failure to timely file a Form SD regarding payments by resource extraction issuers does not cause an issuer to lose Form S-3 eligibility (Question 9).