What do I need to know about cobalt, lithium and graphite from risk areas?

What you need to do concretely

What is expected of you

Cobalt, lithium, nickel and natural graphite come from places in the world where extraction can be associated with human rights violations or environmental damage. The Battery Regulation imposes an obligation in relation to this: anyone who places batteries on the EU market must conduct a due diligence policy for these raw materials. This policy is described in Articles 47 to 53 of Regulation (EU) 2023/1542.

Draw up and maintain a due diligence policy

It is a systematic approach: identify, assess and mitigate risks in the supply chain, and report on them. For a company with 10 to 100 employees, this usually does not require in-house mining expertise, but rather a documented way of working — who within the company is responsible for this matter, which sources are consulted to assess risks, and how often this policy is reviewed. Companies that do not themselves procure raw materials but import batteries or battery-containing products cannot avoid this obligation — the Regulation places responsibility with whoever places the product on the market, not only with whoever extracts or processes the raw material.

Trace the origin of raw materials

To be able to assess risks, it must first be clear where cobalt, lithium, nickel and graphite in a battery come from. In practice, this means that data is needed from suppliers and, where these are not delivered directly, from manufacturers further up the chain. For an importer who sources batteries or cells from a factory, this is often the most difficult part: the importer's own supplier is sometimes only an intermediary themselves. What exactly is to be requested from a cell supplier for the passport depends on how much the supplier already maintains as standard, but the origin of raw materials should be part of it.

Assess risks and report on them

Once the origin is known, an assessment follows of the risks associated with that specific origin — consider the nature of the extraction area or the reputation of intermediaries. For most companies in the target group of batpas.eu, this is not a task that is built from scratch: international standards and sector initiatives have existed longer for raw materials such as cobalt and are often the starting point. The Regulation requires reporting on this, which in practice often amounts to a periodic document demonstrating which steps have been taken and which risks have been identified.

Take appropriate measures for identified risks

When a risk is identified, a response should follow — this can range from asking additional questions of a supplier to adjusting a procurement relationship. What is "appropriate" varies depending on the situation and the size of the company; the Regulation itself elaborates on this in the mentioned Articles. For an importer of e-bike batteries, the emphasis is usually on questioning existing suppliers, rather than on inspecting mining operations on site.

Where things go wrong in practice

The supplier only names the country of assembly, not of raw material extraction. A factory in Southeast Asia that assembles cells is not the place where the cobalt or lithium was extracted. If you do not ask further here, you will unintentionally record the wrong origin.

An importer assumes that certification by the cell supplier is sufficient. A mark or certificate can be part of the due diligence policy, but does not replace the own assessment and documentation that the Regulation requires.

With different suppliers for the same battery, contradictory information about origin arises. One party supplies cells, another assembles the pack, and no one has the complete picture. What to do when the same battery comes from different suppliers is then not only a question for the passport itself, but also for the due diligence policy.

The due diligence policy is drawn up once and then no longer maintained. Suppliers change, mining areas shift in risk profile, and a document that has been lying in a drawer for three years no longer aligns with current procurement.

A Chinese manufacturer provides no data on raw material sourcing, only on the end product. This bottleneck frequently arises when obtaining the correct passport data from a manufacturer in China: the request for information on raw material sourcing is not always answered as standard practice and often needs to be asked separately.

What you can record

• An overview of which raw materials (cobalt, lithium, nickel, natural graphite) are used in which batteries or cell types, per supplier.
• Correspondence in which sourcing information has been requested from suppliers or manufacturers, including any certificates or statements received.
• An internal document stating who is responsible for the due diligence policy and with what frequency it is reviewed.
• An assessment of identified risks per sourcing area, with a brief explanation of any follow-up steps.
• Agreements with suppliers on the periodic provision of current sourcing data — this can be incorporated when laying down agreements in the purchase contract, so that the obligation does not remain separate from the commercial relationship.
• A standard questionnaire used with new suppliers, so that data on raw material sourcing is requested as a matter of course — see also what can be requested from a battery supplier.

Anyone who wishes to know more broadly how this due diligence obligation relates to the other obligations under the battery regulation will find an overview in the question what the due diligence obligation for batteries entails.