Statement of Support to the principles of Extractive Industry Transparency Initiative (EITI)

2015 OTIC Report on Due Diligence of Tantalum Supply Chain

Ningxia Orient Tantalum Industry Co., Ltd. (hereinafter called as "OTIC"), as being one of the specialized Ta & Nb smelters in the world, has taken leading position in technology development and production scale through its continual accumulation and development during the past half century. OTIC is also one of the executive members of the Tantalum-Niobium International Study Center (TIC)..We have been doing our best in providing complete series of high-quality Ta & Nb products and excellent services to all worldwide electronic consumers to meet the final-end consumers’various and changing requirements through our continuous creativity.
OTIC strictly complies with the requirements of . As a formal member of iTSCi since 2011, OTIC actively has been giving its support andparticipating in traceability verification of tantalum mineral sourcing from theDemocratic Republic of Congo and its neighbouring nine countries. OTIC is also committed to strictly comply with the requirements of Conflict-Free Smelter Program(CFSP) regarding tantalum mineral supply chain proposed by CFSI.
OTIC has established complete supply chain control system for conflict-free raw materials through taking measures and performing procedures as follows to ensure " Conflict Minerals" from conflict-affected areas would never be purchased and used, ,and to prevent any conflict minerals from entering into OTIC supply chain.OTIC solemnly declared that OTIC only purchase tantalum raw material identified through iTSCi packing & tagging system from iTSCi formal members for the material sourcing from the Democratic Republic of Congo and its surrounding nine countries. And only purchase the tantalum intermediate products from CFS compliant smelters.
1. Open and Transparent Purchase Policy
1.1 OTIC’s Statement  on Raw Material  Procurement is posted  to the public on  thewebsite of OTIC.
1.2 OTIC released Provisions on Administration of Ta Raw Material  Procurement toits all internal departments at all levels.
2. Controllable Process for Raw Material Procurement
OTIC has  laid down and conducted  eight process control  procedures to restrict  and inhibit "conflict  minerals "  entering into  OTIC’s supply  chain, including  ,,, ,,<  management   procedure  of  intracompany  Ta   scraps  recovery  and usage>,< Management processes of purchasing   documents>,etc..
3. Traceability process of Raw Material
Through conducting  ,to ensure  all Ta raw materials in use is under control and traceable.
4.  Adopting  Transportation   Control  System  and   Inspection Method in Compliance with International Standards and Norms
OTIC   strictly   complies   with    international   regulations   of   dangerous   goods transportation, including  7 class material,  and OTIC  has established  and conducted ,and<   Administrative   Measures   of radioactive materials>.
5. Purchasing and Recycling of Ta Scrap to recycle Resources
OTIC has conducted to purchase and recycle Ta scrap to make full use of these resources.
6.  Performing Due  Diligence  on Raw  Material  Suppliers  andMaintaining Continuity
6.1  OTIC performs  due  diligence  on raw  material  suppliers every  year,  through re-auditing and evaluating the  suppliers’ quality guarantee capability , legality and compliance each year, which  will be used as a basis to select  or disqualify as one of our suppliers. In  this way, OTIC  publicizes and spreads out  to all suppliers ‘OECD Due Diligence Guidance  for Supply Chains  of Minerals from Conflict-Affected  and High-Risk Areas’ as well as CFSI audit standard and requirements for transparency of tantalum supply chain so as to ensure that all raw material suppliers act in accordance with  EICC requirements  and  do not  sell  "conflict minerals  "  to  OTIC and  other demanders.
6.2 OTIC only seek cooperation with formal iTSCi members as cooperative partners in  the Democratic  Republic  of  Congo  and its  surrounding  nine  countries.  OTIC solemnly declared that OTIC only purchases tantalum raw material identified through iTSCi  packing &  tagging system  for  the materials  sourcing  from the  Democratic Republic of  Congo and  its surrounding  nine countries.  OTIC is also  committed to only cooperating with the  tantalum smelters certified to Conflict-Free Smelter (CFS) Program.
6.3 OTIC has set up  its subsidiary in Rwanda so as to conduct on-site due diligenceon material suppliers.
7. Wide Public propagation and Communication Channel
7.1 OTIC performs due diligence on upstream raw material suppliers and spreads out to all  suppliers the OECD  Due Diligence  Guidance for Supply  Chains of Minerals from Conflict-Affected  and  High-Risk Areas,  reminding and  supervising upstream suppliers to operate their business  legally and not to sell "conflict  minerals " to their buyers. The  special clause requirement  for conflict-free minerals  is specified In  the purchasing contract  and all  suppliers are committed  to supplying  with conflict-free minerals.
7.2 OTIC  actively attends  various meetings held  by OECD or  CFSI or iTSCi  and often  makes  discussions   with  the  downstream  customers   to  jointly  study   and understand the OECD  Due Diligence Guidance for Supply  Chains of Minerals from Conflict-Affected  and   High-Risk   Areas  as   well  as   CFSI  audit   standard  and requirements   on  transparency   of  tantalum   supply   chain.  OTIC   keep   regular communication  with the  iTSCi,  thereby     carefully reading  the  iTSCi’s incidents reports   and  monthly   production   assessments   and   monthly  regional   situation evaluation reports,timely understanding the situation at mining sites.
7.3 While  keeping communication  with the  downstream customers, in  compliance with  EICC  requirements,   OTIC  provided  them   with  Conflict  Minerals  Report Template so as to ensure implementation of the due diligence of supply chain.
7.4 OTIC  spreads out  to social public  OECD Due Diligence  Guidance for  Supply Chains of  Minerals from  Conflict-Affected and  High-Risk Areas’  as well  as CFSI audit standard and  requirements on transparency of tantalum  supply chain by means of OTIC website, network, magazines.
7.5 Establishment  of Complaint channel, OTIC  made public its  Complaint channel, including telephone  number  and responsible  person, for  the  purpose of  willing to accept the supervision of all aspects.
8. Training OTIC's Employees in Various Forms
OTIC performs training  of all employees  including top managements to  make them completely understand OECD Due Diligence Guidance for Supply Chain of Minerals from  Conflict-Affected and  High-Risk  Areas as  well  as CFSI  audit  standard  and requirements  on transparency  of tantalum  supply  chain by  means  of concentrated training, internal newspaper, office automation (OA) system, show board, etc.
9.  Actively Fulfill  Social  Duty  to Build  up  a Good  Vision  ofOTIC as a Responsible and Lawfully Operated Listed Company
OTIC  always   closely  combines  economic   development  of  the   enterprise  with execution of  social responsibility  and fully fulfill  the social  duty at the  premise of lawful  and  ethical   operation  through  carrying   out  such  activities   as  technical innovation, safe  production, protecting the  legitimate rights and  interests of  OTIC's employees,  environmental protection,  saving energy,  reducing  pollutants discharge and participation in  social welfare. OTIC Social Responsibility  Report is released to the public yearly.
10. OTIC  has become a formal member  of iTSCi since 2011 and  has kept frequent communication with  iTSCi to  ensure no  conflict material  entering into  our supply chain Since 2011,  OTIC  has accepted  CFS (Conflict-Free  Smelter)  audit by  an independent third  party  entrusted by  CFSI each  year and  has been certified to the  CFS audit .  OTIC passed the  annual CFS audit again  on September 15th, 2015.