Chain of custody records

Chain of custody records show the unbroken sequence of holders, transfers, and transformations for a quantity of covered material, from origin to the battery. The purpose is to allow a quantity in a finished battery to be traced back, step by step, without a break in the sequence. Each transfer record should name the sender, the receiver, the material form, the quantity, the date, and the document that accompanied the transfer. Where material is mixed, blended, or converted, the record must show the method used to allocate quantities, such as segregation or mass balance, and the period over which the allocation applies. A break in custody is a gap, not a detail.

Chain of custody means the documented sequence of custody for a material, including ownership, possession, and processing, from origin to use. The scope is the quantity of cobalt, lithium, nickel, or natural graphite stated for a battery model and period.

What is the legal frame for this record?

Chain of custody for covered raw materials sits inside that sequence, so a record that shows only one step leaves the chain of reasoning incomplete. A refiner issuing custody documents for refined cobalt to a precursor producer therefore needs a file that shows the policy, the owner of the policy, the date of adoption, and the review cycle. A mass balance record for a refiner should show opening stock, receipts, production, shipments, and closing stock for the period, so the quantity claimed for a battery model can be reconciled with total throughput.

How is the chain mapped?

The map should name each tier that handles chain of custody for covered raw materials, record the function of each actor, and note where material changes form, such as refining, precursor production, cathode production, cell production, and pack assembly. Transfer documents, mass balance records, and inventory reconciliations should be tied to a named tier, a named site where that information is known, and a date. A refiner issuing custody documents for refined cobalt to a precursor producer should record gaps on the map itself, with the reason for each gap and the next step planned. Mass balance allows mixing of certified and non certified material within a defined system, while segregation keeps material physically separate, and the record must state which method applies to each quantity claimed.

How is evidence judged?

A supplier statement, a contract clause, a third party audit summary, a mass balance record, and a chain of custody document do not carry equal weight, and the record should say which type supports each claim about chain of custody for covered raw materials. Transfer documents, mass balance records, and inventory reconciliations needs a source name, a collection date, a coverage period, and a statement of what was actually checked. A refiner issuing custody documents for refined cobalt to a precursor producer should separate facts received from conclusions drawn, so a later reviewer can test the conclusion. A mass balance record for a refiner should show opening stock, receipts, production, shipments, and closing stock for the period, so the quantity claimed for a battery model can be reconciled with total throughput.

How is risk identified and assessed?

A red flag can be a place of origin, a processing route, a supplier practice, a change of ownership, or a gap in records for chain of custody for covered raw materials. Mass balance allows mixing of certified and non certified material within a defined system, while segregation keeps material physically separate, and the record must state which method applies to each quantity claimed. A refiner issuing custody documents for refined cobalt to a precursor producer should date each assessment and name the person or function responsible for the next review.

How is mitigation planned and followed up?

For chain of custody for covered raw materials, the plan should state the risk addressed, the action chosen, the supplier or site involved, the support offered, and the evidence that will show whether the action worked. Transfer documents, mass balance records, and inventory reconciliations collected after the action should be compared with the position before the action, using the same measure where possible. A mass balance record for a refiner should show opening stock, receipts, production, shipments, and closing stock for the period, so the quantity claimed for a battery model can be reconciled with total throughput.

How is reporting checked?

The due diligence report should summarise the policy, the management system, the risks found, the actions taken, and the verification arranged for chain of custody for covered raw materials, without disclosing confidential commercial detail that the Regulation does not require to be published. A refiner issuing custody documents for refined cobalt to a precursor producer should check that every public claim can be traced to an internal record, and that the report date, coverage period, and scope match the internal file. Mass balance allows mixing of certified and non certified material within a defined system, while segregation keeps material physically separate, and the record must state which method applies to each quantity claimed.

How is a custody break found in a mass balance?

A custody break is found by reconciling a mass balance over a period: opening stock plus receipts minus shipments minus production use should equal closing stock, within the stated measurement tolerance. If the closing stock in the record is higher than the reconciled figure, material has been added without a receipt. If it is lower, material has left without a shipment record. A worked example for a refiner over one quarter shows receipts from three mines, shipments to two precursor producers, and a closing stock that is checked against a physical count. The break, where found, is recorded as a quantity, a date range, and a follow up action, and the affected quantity is excluded from verified claims until the break is resolved.

Custody ends at the point where the next transfer is undocumented, and the record should mark that point plainly rather than extend the chain by assumption.