Exhibit 1.01
Freescale Semiconductor, Ltd.
Conflict Minerals Report
For the reporting period from January 1, 2014 to December 31, 2014
This Conflict Minerals Report (the “Report”) of Freescale Semiconductor, Ltd. has been prepared under Rule 13p-1 and Form SD (the “Rule”) promulgated under the Securities Exchange Act of 1934, as amended, for the reporting period January 1, 2014 to December 31, 2014. Freescale Semiconductor, Ltd. refers to the operations of Freescale Semiconductor, Ltd. and its subsidiaries and may be referred to as the “Company,” “Freescale,” “we,” “us” or “our,” as the context requires. The content of any website referred to in this Report is included for general information only and is not incorporated by reference into this Report.
The Rule requires disclosure of certain information when a company manufactures or contracts to manufacture products for which specified minerals are necessary to the functionality or production of those products. The specified minerals are columbite-tantalite (coltain), cassiterite, wolframite, tantalum, tin, tungsten and gold, which we collectively refer to in this Report as “3TG”. For the purposes of this Report, we refer to the “DRC Region” as the Democratic Republic of the Congo and any adjoining country that shares an internationally recognized border with the Democratic Republic of the Congo.
Certain matters discussed in this Report include forward-looking statements. These forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from the expectations expressed in the forward-looking statements. We undertake no obligation to update any information contained in this Report.
Freescale has determined that 3TG are necessary to the functionality or production of products that it manufactures or contracts to manufacture.
Description of Freescale’s Products Covered by this Report
This Report relates to products: (i) for which 3TG are necessary to the functionality or production; (ii) that were manufactured, or contracted to be manufactured, by Freescale; and (iii) for which the manufacture was completed during calendar year 2014 (collectively, the “Covered Products”).
The Covered Products consist of our semiconductor products and customer development hardware tools.
Freescale’s Due Diligence Process
As required under the Rule, Freescale has taken the measures described in this Report to exercise due diligence on the source and chain of custody of 3TG necessary to the functionality or production of the Covered Products. Freescale’s due diligence measures have been designed to conform to the framework in the Organisation for Economic Co-operation and Development Due Diligence Guidance for Responsible Supply Chain of Minerals from Conflict-Affected and High Risk Areas: Second Edition, including the related supplements on gold, tin, tantalum and tungsten (the “OECD Guidance”), as it relates to our position as a “downstream” purchaser.
Step 1: Establish Strong Company Management Systems
Freescale has adopted a Supplier Code of Conduct, available at http://www.freescale.com/webapp/sps/site/overview.jsp?code=SDIVERSITY_CONDUCT, which, among other things, communicates Freescale’s expectations to its suppliers with respect to responsible sourcing of 3TG. Suppliers are expected to have a policy to reasonably assure that 3TG in the products they supply do not directly or indirectly finance or benefit armed groups that are perpetrators of serious human rights abuses in the DRC Region. Suppliers must exercise due diligence on the source and chain of custody of these minerals and make their due diligence measures available to Freescale upon request.
Freescale assembled an internal team from the procurement, legal and finance organizations to lead its 3TG supply chain due diligence. Freescale’s Senior Vice President, General Counsel and Secretary oversaw the activities of this internal team.
Step 2: Identify and Assess Risks in the Supply Chain
Freescale’s supply chain is complex, and in most cases there are many third parties in the supply chain between Freescale’s ultimate manufacture of the Covered Products and the original sources of 3TG. Freescale requires its suppliers to identify the smelters and refiners of 3TG in their supply chain. In most cases, our suppliers reported this information using the broadly adopted conflict minerals reporting template developed by the Conflict Free Sourcing Initiative (“CFSI”), a multi-industry initiative consisting of over 200 companies and associations. Because of the complexity of our supply chain, we rely on our suppliers for the accuracy and completeness of this information. In most cases, our suppliers submit a consolidated smelter and refiner report for all of their products and materials, not just products and materials provided to Freescale.
Step 3: Design and Implement a Strategy to Respond to Identified Risks
Our procurement organization has implemented escalation procedures for suppliers who (i) provide products that incorporate 3TG from smelters or refiners that do not comply with a third-party audit program or (ii) have not provided details on the sourcing of 3TG in their supply chain. Under these procedures, our procurement organization develops a list of corrective actions which include a timeline for compliance and may include a decision to continue or temporarily suspend trade with the supplier during the corrective action period. As needed, suppliers who do not make satisfactory progress addressing the identified corrective actions will be reported to senior management.
Freescale’s due diligence measures with respect to identified smelters and refiners were primarily based on multi-industry due diligence initiatives to evaluate the procurement practices of the smelters and refiners that process and provide 3TG to our supply chain. In some cases, suppliers reported smelters and refiners that we believe are not operational or may have been misidentified as smelters and refiners. Where practicable, Freescale contacted or attempted to contact smelters and refiners that were neither currently compliant nor in the process of becoming compliant with a third-party audit program to request more information about the country of origin of the 3TG utilized in the smelter’s operations.
Step 4: Carry out Independent Third-Party Audit of Smelter/Refiner’s Due Diligence Practices
We believe that engagement and active cooperation with other industry members with whom we share suppliers assist in the identification of risks in Freescale’s supply chain by facilitating identification of smelters and refiners and assessment of their due diligence practices. Freescale is a member of, and participates in, CFSI, IPC (a global trade association serving the printed board and electronics assembly
industries) and the Electronic Industry Citizenship Coalition, all of which work toward responsible sourcing of 3TG.
Freescale actively participates in CFSI’s Conflict Free Smelter Program (“CFSP”), an independent third-party audit program developed according to global standards including the OECD Guidance to identify smelters and refiners that have systems in place to assure sourcing of only conflict-free materials.
Step 5: Report Annually on Supply Chain Due Diligence
This Report is publicly available at http://www.freescale.com/webapp/sps/site/overview.jsp?code=CORP_CONFMATERIALS.
Results of Due Diligence Measures
Based on an internal assessment and information provided by our suppliers, Freescale identified 84 suppliers who provided materials likely to incorporate 3TG necessary to the functionality of the Covered Products (the “3TG Suppliers”).
This Report reflects valid responses from 68 of the 84 3TG Suppliers. These 68 suppliers represent 99.5% of the amount Freescale paid to all 84 3TG Suppliers in 2014. Freescale has engaged non-responsive 3TG Suppliers under the escalation procedures described in Step 3 above.
Based on the information provided by our suppliers and information otherwise obtained through the due diligence process, Freescale has reasonably determined that the facilities that may have been used to process the 3TG in Freescale’s products in 2014 include the smelters and refiners listed in Annex I. Based on information received through the CFSP, equivalent independent third-party audit programs or otherwise obtained through the due diligence process, Freescale believes the countries of origin of the 3TG contained in its products include the countries listed in Annex II.
Of the 206 smelters and refiners identified in Annex I, 141 smelters and refiners currently comply with a third-party audit program and an additional 27 smelters and refiners are participating in a program to become compliant. Of the 38 identified smelters and refiners that were neither currently compliant nor in the process of becoming compliant with a third-party audit program, we contacted or attempted to contact 29 smelters to request more information about the country of origin of the 3TG utilized in the smelter’s operations. We were unable to obtain contact information for 9 identified smelters, and we believe three smelters are no longer operational. Fourteen smelters or refiners were identified as sourcing 3TG from the DRC Region, all of which were compliant with the CFSP assessment protocols.
Additional Measures
Freescale intends to take the following steps, among others, this year to improve its due diligence measures and to further mitigate the risk that Freescale’s use of 3TG might finance or benefit armed groups in the DRC Region:
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| • | update the list of products and 3TG Suppliers to be included in Freescale’s due diligence process for the 2015 calendar year; |
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| • | re-engage each 3TG Supplier to obtain current and accurate information about the supplier’s supply chain of 3TG; |
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| • | execute Freescale’s escalation procedure with each supplier that (i) is non-responsive to requests for information or (ii) does not have systems in place to ensure sourcing of only conflict-free materials; and |
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| • | participate in industry initiatives encouraging “conflict-free” supply chains and identifying “conflict-free” smelters and refiners. |
Annex I
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| Mineral | Smelter or Refiner Name | Country location of Smelter or Refiner |
| Gold | Allgemeine Gold-und Silberscheideanstalt A.G.* | Germany |
| Gold | Almalyk Mining and Metallurgical Complex (AMMC)* | Uzbekistan |
| Gold | AngloGold Ashanti Córrego do Sítio Minerção* | Brazil |
| Gold | Argor-Heraeus SA* | Switzerland |
| Gold | Asahi Pretec Corporation* | Japan |
| Gold | Asaka Riken Co Ltd | Japan |
| Gold | Atasay Kuyumculuk Sanayi Ve Ticaret A.S.* | Turkey |
| Gold | Aurubis AG* | Germany |
| Gold | Bangko Sentral ng Pilipinas (Central Bank of the Philippines)* | Philippines |
| Gold | Bauer Walser AG | Germany |
| Gold | Boliden AB* | Sweden |
| Gold | C. Hafner GmbH + Co. KG* | Germany |
| Gold | Caridad | Mexico |
| Gold | CCR Refinery – Glencore Canada Corporation* | Canada |
| Gold | Cendres + Métaux SA | Switzerland |
| Gold | Chimet S.p.A.* | Italy |
| Gold | Chugai Mining | Japan |
| Gold | Daejin Indus Co. Ltd | Korea, Republic of |
| Gold | Do Sung Corporation | Korea, Republic of |
| Gold | Doduco | Germany |
| Gold | Dowa* | Japan |
| Gold | Eco-System Recycling Co., Ltd.* | Japan |
| Gold | FAGGI ENRICO SPA | Italy |
| Gold | FSE Novosibirsk Refinery | Russian Federation |
| Gold | Heimerle + Meule GmbH* | Germany |
| Gold | Heraeus Ltd. Hong Kong* | Hong Kong |
| Gold | Heraeus Precious Metals GmbH & Co. KG* | Germany |
| Gold | Hunan Chenzhou Mining Group Co., Ltd. | China |
| Gold | Hwasung CJ Co. Ltd | Korea, Republic of |
| Gold | Inner Mongolia Qiankun Gold and Silver Refinery Share Company Limited* | China |
| Gold | Ishifuku Metal Industry Co., Ltd.* | Japan |
| Gold | Istanbul Gold Refinery* | Turkey |
| Gold | Japan Mint* | Japan |
| Gold | Jiangxi Copper Company Limited* | China |
| Gold | Johnson Matthey Inc* | United States |
| Gold | Johnson Matthey Ltd* | Canada |
| Gold | JSC Ekaterinburg Non-Ferrous Metal Processing Plant* | Russian Federation |
| Gold | JSC Uralelectromed* | Russian Federation |
| Gold | JX Nippon Mining & Metals Co., Ltd.* | Japan |
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| Gold | Kazzinc Ltd* | Kazakhstan |
| Gold | Kennecott Utah Copper LLC* | United States |
| Gold | Kojima Chemicals Co., Ltd* | Japan |
| Gold | Korea Metal Co. Ltd | Korea, Republic of |
| Gold | Kyrgyzaltyn JSC* | Kyrgyzstan |
| Gold | L' azurde Company For Jewelry* | Saudi Arabia |
| Gold | Lingbao Jinyuan Tonghui Refinery Co. Ltd. | China |
| Gold | LS-NIKKO Copper Inc.* | Korea, Republic of |
| Gold | Materion* | United States |
| Gold | Matsuda Sangyo Co., Ltd.* | Japan |
| Gold | Metalor Technologies (Hong Kong) Ltd* | Hong Kong |
| Gold | Metalor Technologies (Singapore) Pte. Ltd.* | Singapore |
| Gold | Metalor Technologies SA* | Switzerland |
| Gold | Metalor USA Refining Corporation* | United States |
| Gold | METALÚRGICA MET-MEX PEÑOLES, S.A. DE C.V* | Mexico |
| Gold | Mitsubishi Materials Corporation* | Japan |
| Gold | Mitsui Mining and Smelting Co., Ltd.* | Japan |
| Gold | Moscow Special Alloys Processing Plant* | Russian Federation |
| Gold | Nadir Metal Rafineri San. Ve Tic. A.Ş.* | Turkey |
| Gold | Navoi Mining and Metallurgical Combinat* | Uzbekistan |
| Gold | Nihon Material Co. LTD* | Japan |
| Gold | Ohio Precious Metals, LLC* | United States |
| Gold | OJSC “The Gulidov Krasnoyarsk Non-Ferrous Metals Plant” (OJSC Krastvetmet)* | Russian Federation |
| Gold | OJSC Kolyma Refinery* | Russian Federation |
| Gold | PAMP SA* | Switzerland |
| Gold | Prioksky Plant of Non-Ferrous Metals* | Russian Federation |
| Gold | PT Aneka Tambang (Persero) Tbk* | Indonesia |
| Gold | PX Précinox SA* | Switzerland |
| Gold | Rand Refinery (Pty) Ltd* | South Africa |
| Gold | Royal Canadian Mint* | Canada |
| Gold | Sabin Metal Corp. | United States |
| Gold | SAMWON METALS Corp. | Korea, Republic of |
| Gold | Schone Edelmetaal* | Netherlands |
| Gold | SEMPSA Joyería Platería SA* | Spain |
| Gold | Shandong Zhaojin Gold & Silver Refinery Co. Ltd* | China |
| Gold | So Accurate Group, Inc. | United States |
| Gold | SOE Shyolkovsky Factory of Secondary Precious Metals | Russian Federation |
| Gold | Solar Applied Materials Technology Corp.* | Taiwan |
| Gold | Sumitomo Metal Mining Co., Ltd.* | Japan |
| Gold | Tanaka Kikinzoku Kogyo K.K.* | Japan |
| Gold | The Great Wall Gold and Silver Refinery of China* | China |
| Gold | The Refinery of Shandong Gold Mining Co. Ltd* | China |
| Gold | Tokuriki Honten Co., Ltd* | Japan |
| Gold | Tongling nonferrous Metals Group Co.,Ltd | China |
| Gold | Torecom | Korea, Republic of |
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| | |
| Gold | Umicore Brasil Ltda* | Brazil |
| Gold | Umicore SA Business Unit Precious Metals Refining* | Belgium |
| Gold | United Precious Metal Refining, Inc.* | United States |
| Gold | Valcambi SA* | Switzerland |
| Gold | Western Australian Mint trading as The Perth Mint* | Australia |
| Gold | YAMAMOTO PRECIOUS METAL CO., LTD.* | Japan |
| Gold | Yokohama Metal Co Ltd | Japan |
| Gold | Zhongyuan Gold Smelter of Zhongjin Gold Corporation* | China |
| Gold | Zijin Mining Group Co. Ltd* | China |
| Tantalum | Changsha South Tantalum Niobium Co., Ltd.* | China |
| Tantalum | Conghua Tantalum and Niobium Smeltry* | China |
| Tantalum | Duoluoshan* | China |
| Tantalum | Exotech Inc.* | United States |
| Tantalum | F&X Electro-Materials Ltd.* | China |
| Tantalum | Global Advanced Metals* | United States |
| Tantalum | Guangdong Zhiyuan New Material Co., Ltd.* | China |
| Tantalum | H.C. Starck Group* | Germany |
| Tantalum | Hengyang King Xing Lifeng New Materials Co., Ltd.* | China |
| Tantalum | Hi-Temp* | United States |
| Tantalum | JiuJiang JinXin Nonferrous Metals Co., Ltd.* | China |
| Tantalum | Jiujiang Tanbre Co., Ltd.* | China |
| Tantalum | KEMET Blue Powder* | United States |
| Tantalum | King-Tan Tantalum Industry Ltd* | China |
| Tantalum | LSM Brasil S.A.* | Brazil |
| Tantalum | Metallurgical Products India (Pvt.) Ltd.* | India |
| Tantalum | Mitsui Mining & Smelting* | Japan |
| Tantalum | Molycorp Silmet A.S.* | Estonia |
| Tantalum | Ningxia Orient Tantalum Industry Co., Ltd.* | China |
| Tantalum | Plansee* | Austria |
| Tantalum | RFH Tantalum Smeltry Co., Ltd* | China |
| Tantalum | Solikamsk Magnesium Works OAO* | Russian Federation |
| Tantalum | Taki Chemicals* | Japan |
| Tantalum | Tantalite Resources | South Africa |
| Tantalum | Telex* | United States |
| Tantalum | Ulba* | Kazakhstan |
| Tantalum | Zhuzhou Cement Carbide* | China |
| Tin | Alpha* | United States |
| Tin | China Tin Group Co., Ltd. | China |
| Tin | CNMC (Guangxi) PGMA Co. Ltd. | China |
| Tin | Cooper Santa* | Brazil |
| Tin | CV JusTindo | Indonesia |
| Tin | CV Nurjanah | Indonesia |
| Tin | CV Serumpun Sebalai | Indonesia |
| Tin | CV United Smelting* | Indonesia |
| Tin | Electroloy Metal Pte | China |
| Tin | EM Vinto* | Bolivia |
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| Tin | Feinhütte Halsbrücke GmbH | Germany |
| Tin | Fenix Metals | Poland |
| Tin | Gejiu Non-Ferrous Metal Processing Co. Ltd.* | China |
| Tin | Gejiu Zi-Li | China |
| Tin | Huichang Jinshunda Tin Co. Ltd | China |
| Tin | Jiangxi Ketai Advanced Material Co., Ltd.* | China |
| Tin | Gejiu Kai Meng Industry and Trade LLC | China |
| Tin | Koki Products Co.,Ltd | Thailand |
| Tin | KOVOHUTĚ PŘÍBRAM NÁSTUPNICKÁ, A.S. | Czech Republic |
| Tin | Linwu Xianggui Smelter Co | China |
| Tin | Magnu's Minerais Metais e Ligas LTDA* | Brazil |
| Tin | Malaysia Smelting Corporation (MSC)* | Malaysia |
| Tin | Metallic Resources Inc | USA |
| Tin | Metallo Chimique* | Belgium |
| Tin | Mineração Taboca S.A.* | Brazil |
| Tin | Minsur* | Peru |
| Tin | Mitsubishi Materials Corporation* | Japan |
| Tin | Nankang Nanshan Tin Manufactory Co., Ltd | China |
| Tin | Novosibirsk Integrated Tin Works | Russian Federation |
| Tin | O.M. Manufacturing (Thailand) Co., Ltd. | Thailand |
| Tin | OMSA* | Bolivia |
| Tin | PT Alam Lestari Kencana | Indonesia |
| Tin | PT Artha Cipta Langgeng* | Indonesia |
| Tin | PT Babel Inti Perkasa* | Indonesia |
| Tin | PT Babel Surya Alam Lestari | Indonesia |
| Tin | PT Bangka Kudai Tin | Indonesia |
| Tin | PT Bangka Putra Karya* | Indonesia |
| Tin | PT Bangka Timah Utama Sejahtera | Indonesia |
| Tin | PT Bangka Tin Industry* | Indonesia |
| Tin | PT Belitung Industri Sejahtera* | Indonesia |
| Tin | PT BilliTin Makmur Lestari | Indonesia |
| Tin | PT Bukit Timah* | Indonesia |
| Tin | PT DS Jaya Abadi* | Indonesia |
| Tin | PT Eunindo Usaha Mandiri* | Indonesia |
| Tin | PT Fang Di MulTindo | Indonesia |
| Tin | PT Karimun Mining | Indonesia |
| Tin | PT Mitra Stania Prima* | Indonesia |
| Tin | PT Prima Timah Utama* | Indonesia |
| Tin | PT REFINED BANGKA TIN* | Indonesia |
| Tin | PT Sariwiguna Binasentosa* | Indonesia |
| Tin | PT Stanindo Inti Perkasa* | Indonesia |
| Tin | PT Sumber Jaya Indah | Indonesia |
| Tin | PT Supra Sukses Trinusa | Indonesia |
| Tin | PT Tambang Timah* | Indonesia |
| Tin | PT Timah (Persero), Tbk* | Indonesia |
| | PT Pelat Timah Nusantara Tbk | Indonesia |
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| | |
| Tin | PT Tinindo Inter Nusa* | Indonesia |
| Tin | Rui Da Hung | Taiwan |
| Tin | Senju | Japan |
| Tin | Soft Metais, Ltda. | Brazil |
| Tin | Thaisarco* | Thailand |
| Tin | White Solder Metalurgia e Mineração Ltda.* | Brazil |
| Tin | Yunnan Chengfeng Non-ferrous Metals Co.,Ltd. | China |
| Tin | Yunnan Tin Company, Ltd.* | China |
| Tungsten | A.L.M.T. Corp. | Japan |
| Tungsten | Dayu Weiliang Tungsten Co., Ltd. | China |
| Tungsten | Fujian Jinxin Tungsten Co., Ltd.* | China |
| Tungsten | Ganzhou Huaxing Tungsten Products Co., Ltd.* | China |
| Tungsten | Ganzhou Jiangwu Ferrotungsten Co., Ltd.* | China |
| Tungsten | Ganzhou Non-ferrous Metals Smelting Co., Ltd. | China |
| Tungsten | Ganzhou Seadragon W & Mo Co., Ltd.* | China |
| Tungsten | Global Tungsten & Powders Corp.* | United States |
| Tungsten | Guangdong Xianglu Tungsten Co., Ltd. | China |
| Tungsten | H.C. Starck GmbH | Germany |
| Tungsten | H.C. Starck Group* | Germany |
| Tungsten | Hunan Chenzhou Mining Group Co., Ltd. | China |
| Tungsten | Hunan Chunchang Nonferrous Metals Co., Ltd.* | China |
| Tungsten | Japan New Metals Co., Ltd.* | Japan |
| Tungsten | Kennametal Fallon | United States |
| Tungsten | Kennametal Huntsville | United States |
| Tungsten | North American Tungsten | Canada |
| Tungsten | Tejing (Vietnam) Tungsten Co., Ltd. | Viet Nam |
| Tungsten | Wolfram Bergbau und Hütten AG* | Austria |
| Tungsten | Xiamen Tungsten (H.C.) Co., Ltd.* | China |
| Tungsten | Xiamen Tungsten Co., Ltd.* | China |
| Tungsten | Xinhai Rendan Shaoguan Tungsten Co., Ltd. | China |
*Based on a review of publicly available information, smelter or refiner has received a “conflict free” designation from an independent third party audit program as of May 5, 2015.
Annex II
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| Countries of Origin |
| Argentina | France | Namibia | Vietnam |
| Australia | Germany | Netherlands | Zimbabwe |
| Austria | Guyana | Nigeria | Kenya |
| Belgium | Hungary | Peru | Mozambique |
| Bolivia | India | Portugal | South Africa |
| Brazil | Indonesia | Russia | Angola |
| Canada | Ireland | Sierra Leone | Burundi |
| Chile | Israel | Singapore | Central African Republic |
| China | Japan | Slovakia | Republic of Congo |
| Colombia | Kazakhstan | South Korea | Rwanda |
| Côte D'Ivoire | Laos | Spain | South Sudan |
| Czech Republic | Luxembourg | Suriname | Tanzania |
| Djibouti | Madagascar | Switzerland | Uganda |
| Egypt | Malaysia | Taiwan | Zambia |
| Estonia | Mongolia | United Kingdom | The Democratic Republic of Congo |
| Ethiopia | Myanmar | United States of America | |
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