日期：2020-9-23 17:15:46 作者： 来源：
LBMA Responsible Silver Supply Chain Due Diligence
管 理 体 系
Due Diligence Policy forSilver Supply Chain
Jiyuan Wanyang Smeltery (Group) Co., Ltd. strictly abides by theLBMA Responsible Silver Guidance, and establishes a due diligence management system for the silver supply chain in accordance with its requirements. The Company actively promotes due diligence in the silver supply chain to ensure that the silver supply chain meets the requirements of theLBMA Responsible Silver Guidance. We will strictly prohibit the following behaviors in the supply chain:
1. Violation of human rights, including the use of child labor, torture, inhuman and degrading treatment, widespread use of violence or other serious forms of forced labor against human right, war crimes, crimes against humanity or genocide;
2. Direct or indirect support to illegal armed groups or to public or private security forces that illegally control mining areas, dealers, other intermediaries and transportation routes through the supply chain, or illegal taxation or extorting money or mineral products throughout the supply chain (“illegal armed groups, public or private security forces”);
3. Covering up the origin of silver through bribery or fraud;
4. Intention to comply with the Government’s tax requirements for extraction, trade and export of mineral products from conflict-affected and high-risk areas;
5. Money-laundering or terrorist financing;
6. Financing conflicts;
7. Engaging in high-risk businesses, such as arms, gambling, antiques and works of art, sects and their leaders;
8. The beneficiary is a politically sensitive person or wanted person;
If the above behaviors are found in the supply chain, we will take measures to isolate the purchased products and immediately suspend or interrupt any transactions with the supplier.
We will regularly assess supply chain risks according to the requirements of the management system, establish due diligence management files for suppliers, and ensure that the supply chain continuously meets the requirements of theLBMA Responsible Silver Guidance.
1 Scope ofApplication
This standard specifies the responsibilities, contents and methods of management activities in the silver supply chain management process of Jiyuan Wanyang Smeltery (Group) Co., Ltd.
This standard is applicable to Jiyuan Wanyang Smeltery (Group) Co., Ltd. and all silver suppliers and silver-related partners (including silver producers, middlemen, silver dealers, exporters and transporters) that have silver trading and silver processing with Jiyuan Wanyang Smeltery (Group) Co., Ltd.
LBMA Responsible Silver Guidance (1st Edition Released in September 2017)
Silver supply chain: suppliers who supply lead concentrate, silver concentrate, crude lead, anode slime and other silver-containing materials needed for silver production and customers who sell silver products.
4 Organizational Structure and Responsibilities
4.1 Jiyuan Wanyang Smeltery (Group) Co., Ltd. has set up a special management team for due diligence of silver supply chain. The organizational structure is as follows:
Silver Management Organization Structure
4.2.1 Compliance Director
Li Wenzhong, Deputy General Manager of Senior Manager Authorized by Jiyuan Wanyang Smeltery (Group) Co., Ltd., is responsible for approving the signing of cooperation contracts with suppliers based on our Company’s raw material procurement policy and the Company’s actual situation such as production, finance and sales (including whether to sign contracts with high-risk suppliers), and for reviewing relevant matters concerning suppliers. Internal senior managers train relevant employees according to documents ofLBMA Responsible Silver Guidance, so that relevant responsible persons can clearly understand the purpose and significance of this system, understand their responsibilities in the implementation of due diligence policies, and organize training for half a year to review relevant contents.
4.2.2 Compliance Manager
Assist senior management to be fully responsible for due diligence of silver supply chain, take charge in all matters in the silver supply chain, ensure that appropriate measures are taken in high-risk supply chains or transactions, and submit risk assessment reports. It is also obliged to train on the responsible supply chain, draft and update the silver supply chain policy, and provide accurate information for senior managers to fulfill their responsibilities.
(1) Have the right to monitor the due diligence process of the silver supply chain and evaluate whether due diligence is fully conducted; Have the right to request additional documents or information if deemed necessary.
(2) If there is a high-risk supply chain or transaction, it is necessary to report to the deputy general manager in charge of business in a timely manner.
(3) Regularly train employees on silver supply chain rules, draft and update silver supply chain rules, and provide accurate information for senior management to fulfill their responsibilities.
(4) Carry out on-site investigation on important customers at least once a year;
(5) Assist and encourage silver raw material suppliers and silver trading customers to promise to abide by the due diligence rules of the silver supply chain;
(6) In case of any abnormal situation, it is necessary to report it to the senior management in a timely manner.
4.2.3 The Raw Material Procurement Center is responsible for the procurement of raw materials to ensure the long-term, stability and safety of the supply of mineral powder and raw materials, and refuses to cooperate with relevant enterprises, organizations or countries in high-risk areas.
4.2.4 The Quality Inspection Center weighs, and tests the purchased silver-containing raw materials; The Production and Operation Department is responsible for the delivery and storage records of raw materials; The Precious Metals Division is responsible for weighing and marking the output silver ingots. The workshop organizes the feeding production and makes the feeding records and output silver ingots records. Closed processes are adopted in the production process to ensure the safety and traceability of silver production and processing.
4.2.5 The Quality Inspection Center shall ensure the accuracy of silver purity detection.
4.2. 6 The Production and Operation Department is responsible for cooperating with the Raw Material Purchase Center to ensure the accuracy of receiving silver-containing raw materials. The Precious Metals Division is responsible for counting the quantity of silver before sales to ensure the safety of silver in kind leaving the factory.
4.2.7 The Raw Material Procurement Center (Overseas) and the Marketing Center shall confirm the identity information of the deliverer, and adopt a supervision mechanism to ensure the safety of the transaction and ensure that the Company does not participate in terrorist financing during the transaction.
4.2.8 The Raw Material Procurement Center shall formulate a training plan, organize training for compliance specialists, to make them learn the relevant contents ofLBMA Responsible Silver Guidance, and accurately grasp the relevant policies of the Company’s responsible silver management.
5 Management System
5.1 Develop and publish the Company’s due diligence policy on LBMA responsible silver supply chain
5.1.1 The Company makes Announcement on LBMA Responsible Silver to inform the supply chain partners to strictly abide by the Company’s silver supply chain management system and publicly accept the supervision of all sectors of society and employees throughout the Company.
5.1.2 For procurement of silver raw materials, the Company undertakes to abide by theLBMA Responsible Silver Guidance, actively participate in and support the traceability of LBMA silver-containing raw materials, strictly abide by the requirements of the Conflict-Free Refiner Plan in Silver Supply Chain, and not to trade with suppliers of silver raw materials from conflict-affected areas and high-risk areas.
5.2 Due diligence process
5.2.1 Before the transaction, the Company shall clearly inform the other party of the management policies and requirements of the responsible silver supply place of the Company.
5.2.2 Issue due diligence questionnaires to suppliers and customers. Please refer to the due diligence questionnaires for details to collect corresponding qualifications and data.
5.2.3 Follow up and withdraw the due diligence questionnaire and conduct risk assessment.
5.2.4 Prepare due diligence report.
5.3 Content of due diligence
5.3.1 Due diligence suppliers include mineral silver suppliers, silver-containing material suppliers, recycled silver suppliers, traders and transporters.
5.3.2 Due diligence customers include traders, buyers, etc.
5.3.3 Before purchasing and selling transactions occur, it is necessary to understand the purchasing and selling situation of the responsible supply chain of suppliers and customers from conflict-affected, high-risk areas and other risk situations.
5.3.4 Due diligence shall include supply chain qualification, identification of silver raw material origin, mining and mountain pass license, mining information to prove whether human rights are violated or operations are illegal, mining capacity data, etc.
5.4 Due diligence measures
5.4.1 Establish supply chain customer/supplier files, including name, legal person, address, contact information, operation mode, transaction contract, etc.
5.4.2 Annual assessment is required for the existing supply chain. If there are suppliers or customers, risk assessment is required for them in a timely manner. Transactions can only be conducted if they meet the system requirements.
5.4.3 Determine that the supply chain is free of any money laundering, fraud or terrorist acts.
5.4.4 Regularly obtain information on the operating status and transaction purpose of supply chain companies.
5.4.5 For mineral and silver suppliers, the following information shall be obtained before trading:
a) Information on the origin of silver
b) Mining permits
c) Provision of permits for the import/export of silver or concentrate
d) Proof of mining information
e) Regular due diligence of mineral silver customers
5.4.6 For customers in the silver recovery supply chain, the following information needs to be obtained before the transaction:
a) Suppliers of recycled silver are required to provide legal business relationships, including information such as proof of the source of recycled silver, beneficiaries, etc.
b) The Company will conduct continuous due diligence on recycled silver customers
5.5 Risk evaluation criteria
5.5.1 Direct assessment as high risk standard
a) The source of mineral silver (including silver concentrate) or recycled silver, and the silver sales area goes by or passes through conflict-affected areas or areas with high risk of human rights violations.
b) Mineral silver originates from a country with known limited reserves, limited resources or expected limited silver production.
c) Recycled silver originates from known, sold to known or suspected sources of silver originating from or passing through conflict-affected areas and areas with high risk of human rights violations.
d)白银供应交易方其他已知上游公司、白银销售客户位于高洗钱风险的国家。d) Other known upstream companies of the silver supply counterparty, and silver sales customers are located in countries with high money laundering risks.
e) The supplier, its known upstream company, and the owner of the equity that has a significant influence on it among the silver sales customers are politically sensitive figures.
f) Suppliers, their known upstream companies, silver sales customers are engaged in high-risk businesses such as weapons, gambling, antiques and works of art, sects and their leaders.
g) High-risk countries and regions coming from and passing through, including conflict and war-torn countries and regions announced by CFSP, countries or regions sanctioned by the United Nations, and high-risk countries and regions for money laundering announced by FATF.
5.5.2 Evaluation method: Based on the contents of the due diligence questionnaire, combined with the corresponding data actually received from suppliers and customers, the evaluation and scoring are carried out according to the evaluation criteria of each project to finally determine the risk level.
5.5.3 Evaluation criteria
a) Please refer to the TableRisk Assessment Criteria for Due Diligence Investigation of Silver Supply Chain (Mineral Raw Materials, Recycled Raw Materials and Customers) for details of risk assessment items.
b) Risk Level
Mineral raw materials: score (R)≥80 points, low risk;
40 points≤R< 80 points, medium risk;
R< 40, high risk;
Recycled raw materials: score (R)≥50 points, low risk:
30≤R< 50 points, medium risk;
R < 30, high risk;
Customer category: score value (R)≥50 points, low risk:
30≤R< 50 points, medium risk;
R<30, high risk;
5.5.4 Response measures
a) Low risk: continue to trade and reduce risk.
b) Medium risk: Suspend trading until it is reduced to low risk.
Communicate with suppliers to promote them to designate and implement improvement measures, and continue trading after confirming that the risks meet the requirements of this regulation within 6 months; If the Supplier refuses to provide relevant legality certificates and rectification reports within 6 months, the Company shall determine it as a high-risk supply chain and stop trading with it. The specific requirements are as follows:
For silver mined on a large scale, silver and recycled silver mined by manual and in small mines: Use credible independent source documents, data and information to verify the situation. From mines to refineries, the revenue owner and government monitoring list information of every company in the supply chain (including silver producers, traders, exporters and transporters) are required to be verified.
c) High risk: stop trading, cut off risks, put them on the Company’s blacklist and prohibit from trading with the company within 3 years.
5.6 Due diligence training for silver supply chain
5.6.1 The Company will carry out the specified training for employees in the silver supply chain every year and incorporate the training plan into the annual training plan.
5.6.2 Employees involved in the silver supply chain must attend for relevant training confirmation through training sign-in.
5.6.3 Adopt the method of explanation and teaching, and conduct assessment.
5.7 Supply chain traceability system
5.7.1 Establish a supply chain traceability system to collect and maintain supply chain information for each refining batch, including assigning a separate reference number to each input and output:
a) Upward traceability of silver products (silver-raw material)
-Silver-containing material type (mineral silver/recycled silver);
-Warehousing weight and analysis report;
-Raw material storage date and finished product storage date;
b) Downward traceability of silver products (silver-customer)
-Transaction weight and analysis report;
-Outbound delivery date;
5.8 Retention of Records
5.8.1 Maintain adequate supply chain documentation as required by LBMA to demonstrate compliance with appropriate and ongoing due diligence.
5.8.2 Keep records of the supply chain traceability system.
5.8.3 Records shall be kept for 5 years.
5.9 Reporting procedures for violations and events in silver supply chain
5.9.1 If any violations or matters found, the relevant staff of the silver supply chain of the Company shall promptly report in writing or by telephone to the Compliance Officer of their organizations or constituent company. The Compliance Officer shall report to the leaders in charge of the organizations and the constituent company and shall also promptly report the found violations, matters and handling suggestions to the Compliance Officer of the Company. The Compliance Officer of the Company shall report to the leader of the Silver Supply Chain Management Leading Group of the Company.
5.9.2 In case systematic or widespread human rights violations are found in relation to the extraction, transportation or trade of silver, or when suppliers provide direct or direct support to illegal non-governmental armed organizations, or fraudulently cover up the origin of silver or there are matters such as money laundering or terrorist financing, the relevant salesman shall notify the supplier of the termination of the contractual relationship.
5.9.3 It is discovered that there may be systematic or widespread human rights violations relating to the extraction, transportation or trade of silver, or when suppliers provide direct or indirect support to illegal non-governmental armed organizations, or fraudulently cover up the origin of silver or there are matters such as money laundering or terrorist financing, the transaction shall be suspended immediately, and a special investigation shall be conducted on supply chain traders to determine whether to continue the transaction in combination with the results of the investigation.
5.10 Silver supply chain transaction monitoring
5.10.1 The Company shall obtain relevant information on each batch of raw materials received to ensure that the Company’s silver supply chain transactions meet the requirements of LBMA Responsibility Silver Guidance, and are consistent with the Company’s risks in the supply chain investigation and assessment, and ensure compliant and legal sources of the Company’s silver.
5.10.2 Weight and quality data, transportation documents (freight bills, shipping bills, railway tickets, pro forma invoices, etc.), import and export related documents, and other information that can be obtained.
5.10.3 In case of high-risk transactions during the transaction, the business personnel must require the customers to provide corresponding information to verify each other, verify whether it is true and consistent, and conduct transaction background investigation at the same time. In case of inconsistent situations, the business personnel must conduct investigation and obtain written investigation results.
5.10.4 Every year, the Compliance Officer organizes and implements the annual internal compliance audit of LBMA responsible silver, prepares the annual compliance report, and reports to the leader of the leading group of the Company’s LBMA responsible silver supply chain management.
5.11 Third party audit and supervision of silver supply chain
5.11.1 An annual third-party audit shall be conducted by a designated and recognized third-party audit institution to ensure continuous improvement.
5.11.2 In view of the risks and problems raised by the third-party audit institutions during the audit process, departments and constituent companies involved in silver supply chain management shall carefully compare the problems and formulate improvement measures, set time limits, assign responsible persons, etc.
5.12.1 If employees of relevant departments and constituent companies of the Company involved in the silver supply chain fail to carry out their work in accordance with the requirements of this Regulation, resulting in adverse consequences, they shall be dealt with according to the relevant accountability management regulations of the Company based on the serious circumstances.
Announcement on LBMA Responsible Silver
Statement on LBMA Responsible Silver Raw Material Purchase
Notice on Appointment of LBMA Responsible Silver Compliance Team
Due Diligence Questionnaire onSupply Chain
Due Diligence Risk Assessment Standard ofSilver Supply Chain
Due Diligence Risk Assessment Form ofSilver Supply Chain