AMD 2012 Annual Report Download - page 25

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“conflict” minerals mined from the Democratic Republic of Congo and adjoining countries in their products,
whether or not these products are manufactured by third parties. As there are many sources of these materials,
these new requirements are unlikely to affect the sourcing of minerals used in the manufacture of semiconductor
devices but will add additional costs associated with complying with the disclosure 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 US 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 may encounter
challenges to satisfy those customers who require that all of the components of our products are certified as
conflict free and 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 finalizing market entry
or public procurement requirements for computers and servers based on ENERGY STAR specification as well as
additional energy consumption limits. Some of these regulations are expected to be approved and implemented in
2013. If such regulations do not contain recommended modifications as proposed by AMD or industry
associations, there is the potential for certain of our microprocessor, chipset and GPU products, as incorporated
in desktop and mobile PCs, workstations, servers and other information and communications technology
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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