No Blood in my Mobile: Regulating Foreign Suppliers

Ninon Moreau-Kastler
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Ninon Moreau-Kastler: EU Tax Observatory, Paris School of Economics

No 37, Working Papers from EU Tax Observatory

Abstract: Can developed countries ensure that the goods they consume are not linked to human rights violations in the developing countries where they are produced? I study the U.S. Dodd-Frank Act Conflict Mineral Rule (2010), a due diligence policy limiting the use of conflict minerals extracted in the Democratic Republic of Congo (DRC) and adjoining countries in the supply chains of U.S. downstream electronic firms. The law increased the administrative costs of complying firms by 4.2%, showing that substantial regulatory constraints were created. I show that these firm-level adjustments changed global exports of minerals: exports of conflict minerals from DRC and its neighbours decreased by 76.5%. Around one-fifth of this change comes from circumvention through legal havens, which then re-export more intensively where foreign suppliers of U.S. firms are located.

Keywords: trade diversion; legal haven; due diligence; minerals; supply chains (search for similar items in EconPapers)
JEL-codes: F14 F59 F63 K33 O13 O24 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2026-01
New Economics Papers: this item is included in nep-afr, nep-law and nep-min
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