AMD 2014 Annual Report Download - page 21

and soil; remediation requirements; product chemical content limitations; manufacturing chemical use and
handling restrictions; pollution control requirements; waste minimization considerations; and requirements with
respect to treatment, transport, storage and disposal of solid and hazardous wastes. If we fail to comply with any
applicable environmental regulations, we may be subject to fines, suspension of production, alteration of our
manufacturing processes, import/export restrictions, sales limitations and/or criminal and civil liabilities.
Existing or future regulations could require us to procure expensive pollution abatement or remediation
equipment, to modify product designs or to incur other expenses to comply with environmental regulations. Any
failure to adequately control the use, disposal, storage or discharge of hazardous substances could expose us to
future liabilities that could have a material adverse effect on our business. We believe we are in material
compliance with applicable environmental requirements and do not expect those requirements to result in
material expenditures in the foreseeable future.
Environmental laws are complex, change frequently and have tended to become more stringent over time.
For example, the European Union (EU) and China are two among a growing number of jurisdictions that have
enacted restrictions on the use of lead and other materials in electronic products. These regulations affect
semiconductor devices and packaging. As regulations restricting materials in electronic products continue to
increase around the world, there is a risk that the cost, quality and manufacturing yields of products that are
subject to these restrictions, may be less favorable compared to products that are not subject to such restrictions,
or that the transition to compliant products may not meet customer road maps, or produce sudden changes in
demand, which may result in excess inventory. A number of jurisdictions including the EU, Australia and China
are developing or have finalized market entry or public procurement regulations for computers and servers based
on ENERGY STAR specifications as well as additional energy consumption limits. There is the potential for
certain of our products being excluded from some of these markets which could materially adversely affect us.
Recent U.S. legislation includes disclosure and reporting requirements for companies who use “conflict”
minerals that originate from the Democratic Republic of Congo or adjoining countries. We will likely incur
additional costs associated with complying with these requirements, such as costs related to determining the
source of any conflict minerals used in our products, auditing the process and reporting to our customers and the
U.S. government. Also, since our supply chain is complex, we may face reputational challenges if we are unable
to sufficiently verify the origins of the subject minerals. Moreover, we are likely to encounter challenges to
satisfy those customers who require that all of the components of our products are certified as “conflict free.” If
we cannot satisfy these customers, they may choose a competitor’s products.
A number of jurisdictions including the EU, Australia and China are developing or have finalized market
entry or public procurement regulations for computers and servers based on ENERGY STAR specifications as
well as additional energy consumption limits. There is the potential for certain of our products being excluded
from some of these markets which could materially adversely affect us.
While we have budgeted for foreseeable associated expenditures, we cannot assure you that future
environmental legal requirements will not become more stringent or costly in the future. Therefore, we cannot
assure you that our costs of complying with current and future environmental and health and safety laws, and our
liabilities arising from past and future releases of, or exposure to, hazardous substances will not have a material
adverse effect on us. See also, “Item 3-Legal Proceedings-Environmental Matters,” below.
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