The European Parliament last week approved a draft regulation intended to prevent the minerals trade from funding conflict and human rights violations in Africa. If adopted, this “conflict minerals” law will oblige all but the smallest EU importers of tin, tungsten, tantalum, gold and their ores from conflict and high-risk areas to do "due diligence" checks on their suppliers, and big manufacturers will also have to disclose how they plan to monitor their sources to comply with the rules. Authorities in EU member states will be responsible for ensuring compliance by companies.
Award-winning journalist Rob Bates raises some highly relevant issues in the wake of the announcement by Ashley Orbach - U.S. Department of State’s special advisor for conflict diamonds for the last three years - that she will be leaving the agency and her role as advisor. There was always going to be a sense of uncertainty concerning the U.S. stance toward the Kimberley Process and human rights in the mining industry under the unpredictable new administration, and the loss of continuity signalled by Orbach's departure may well add to it.
"No, this is not a joke - I wish it were." So begins Chaim Even-Zohar's latest Diamond Intelligence Briefing, which uncovers a bizarre oversight involving the U.S. Kimberley Process Authority (USKPA): it does not officially exist at all. Rather, USKPA's Director and General Counsel Cecelia Gardner told Zohar the organization has been operating under a DBA ("doing business as") name, while the full name is "U.S. Kimberley Process Authority Institute" (USKPAI) ... but this as well has ceased to exist.
The Responsible Jewellery Council (RJC), which collaborates on responsible sourcing practices in the jewelry supply chain, has launched its, "New and improved self-assessment workbook to help kick-start 2017 for our members." RJC explains, "The self-assessment workbook helps members self-assess their performance against the RJC Code of Practices (COP).
In his latest Diamond Intelligence Briefs, “Keeping Stock of U.S. Kimberley Process Certificates”, industry analyst Chaim Even-Zohar takes another hard look at the U.S. rough diamond trade and the country’s half-hearted approach when it comes to implementing Kimberley Process (KP) certification standards domestically.
The Israel Diamond Exchange and Israel Diamond Manufacturers Association sent a letter to Israeli traders Diamond companies in Israel have been granted another two months to voluntarily disclose their assets, inventory and unreported income to the Tax Authority, writes Rapaport News. The trade organizations informed their members that firms have until the end of February to submit the full report of disclosures, as long as they declared their intention to do so by December 29.
Diamond industry analyst Avi Krawitz presents his thoughtful analysis of the year that was in the diamond industry 2016: "The Year Trust Returned to the Diamond Trade".
The Administrative Decision [AD] on the Central African Republic [Temporary Suspension] of May 23, 2013 was modified by the 2015 AD of July 17, 2015 concerning the defining conditions for Central African Republic’s (CAR) resumption of trade in rough diamonds from “compliant zones”. Under the supervision of the Kimberley Process Monitoring Team, a forensic audit needs to be conducted of the rough diamond stockpiles held in the CAR per the criteria set forth in the KP's Operational Framework Agreement.
The founder and CEO of Gemological Science International (GSI), Mark Gershburg, has decided to step down as director of USKPA, writes Stacey Hailes of the National Jeweller. The USKPA, US Kimberley Process Authority, is an organization that works closely with the U.S. government in order to prevent conflict diamonds from circulating with legitimate trade.
We endorse the need for an ‘on-the-ground’ approach in countries which have been subject to sanctions. As a result, this should not be limited to the area of generic policy-setting, rather, there needs to be concrete push towards establishing workable structures through which issues can be managed in a sustainable way, such that it allows people in sanctioned countries to continue to make a living without not having to engage in illicit trade to survive. In the same spirit, we have constantly been advocating for the establishment of a Permanent Secretariat in the UN for the KP. As the PAC study correctly notes, the actual rough diamond production of Cameroon is extremely small; 250 carats per month on average over the last 3 years. The larger picture is the illicit trade coming from CAR. In particular, when we consider that 1 out of 4 people in CAR live directly or indirectly from mining diamonds, we must ensure that we are not inhibiting or starving a population by making rules, procedures and guidelines that will prevent them entirely from being economically active.
- UAE KP Chair, Ahmed Bin Sulayem, in response to PAC’s latest report about conflict diamonds from CAR entering international markets via Cameroon.
The London Diamond Bourse (LDB) has announced that it is now a member of the Responsible Jewellery Council (RJC). This makes LDB the first diamond bourse in the world to join the standards and certification organization. The LDB said its council of management unanimously voted to apply to join the RJC and will now undertake an independent audit to achieve full RJC certification, LDB said in a statement.
Today proves our determination to strengthen our efforts to prevent armed groups around the world from using trade in minerals to finance their activities and propagate conflict. This regulation will put into practice the EU's commitments to this effect. At the same time, no additional red tape for European companies that trade respecting the rules, while EU citizens can be assured that their purchases do not affect human rights in conflict-ridden countries."
- Peter Žiga, Slovak Minister in charge of trade and President of the Council, on EU reaching landmark agreement on conflict minerals regulation.
The Kimberley Process (KP) Plenary held in UAE this week concluded with the announcement that that it has appointed the European Union as its Chair for 2018. The EU will assume responsibility as KP Vice Chair in 2017 with Australia as Chair, and India will be the Vice Chair in 2018 when EU becomes the organisation’s Chair. Consequently, in 2019 India will become the KP Chair.
Last week's surprise announcement that the Indian government was imposing a ban on denominations of Rs 500 and Rs 1000 notes has already has already started to unleash a profound impact on the diamond industry and beyond. On the one hand, industry insiders are saying that payments in Surat would come grinding to a halt for at least the next two to three months owing to paucity of cash funds, and defaults as such would rise.
World Diamond Council (WDC) members representing every sector of the diamond trade, from producer to retail, will join together from November 13 to 17 to promote dialogue in the Kimberley Process (KP), and discuss mechanisms for greater industry inclusion at the organization's Plenary Meeting in Dubai, the WDC said in a statement. “The WDC reaffirms its commitment to assist all parties in their efforts to have a productive dialogue at this year’s Plenary and we are dedicated to supporting the KP’s tripartite structure put in place more than a decade ago,” stated Andrey Polyakov, president o
The World Jewellery Confederation (CIBJO) is celebrating its 90th anniversary this week in Armenia. Describing itself as the “United Nations of the jewellery business,” CIBJO represents the interests of all individuals, organizations and companies earning their livelihoods from jewelry, gemstones and precious metals. CIBJO is the oldest international confederation of national jewelry trade organizations. Its purpose is to encourage harmonization, promote international cooperation in the jewelry industry and to consider issues which concern the trade worldwide.
In his latest Diamond Intelligence Briefing, "A Fraud in Progress... A Criminal Conspiracy to Default Hits Indian Exporters", industry insider Chaim Even-Zohar unravels a massive case of fraud perpetrated by a rogue diamond broker and US-based buyers against Indian diamond suppliers, currently estimated at $35-50 million.
The Namibian newspaper has raised concerns that a new government independent sales company called Namib Desert Diamonds (Namdia), which is designated to sell stones worth over an estimated US$150 million (N$2.1 billion) per year as stipulated by a 10-year agreement between De Beers and the Namibian government, is allegedly operating without the desired level of transparency when it comes to selling Namibian resources.
By Chaim Even-Zohar. Reprinted from Diamond Intelligence Briefs by special arrangement. Click here to read the first article.
The Kimberley Process (KP) has declared three new ‘compliant zones’ in the Central African Republic, meaning diamond exports from those regions can resume after a suspension of more than two years, writes Rapaport News following a statement by the KP. The KP’s monitoring team approved shipments from the sub-prefectures of Boda, Carnot and Nola in the west of the country on September 19, the KP announced. KP Chair Ahmed Bin Sulayem has communicated the decision to all KP participants and observers.
JCK's award-winning news director Rob Bates sat down for a chat with Internet radio program "The Daily Beat" on Breakthru Radio (BTR) to talk all things diamonds, and in particular the Kimberley Process and diamonds in American culture.
BTR: What effect did the movie Blood Diamonds (2006) and reports after that have on the diamond industry?
HRD Antwerp has found grading discrepancies at the HRD Antwerp in Mumbai lab involving a limited number of diamonds which were submitted by one specific client. HRD Antwerp said in a statement that it maintains a continuous and rigorous system of internal controls. "As HRD Antwerp is adamant in upholding its excellent reputation in terms of quality, integrity and controls, the company has taken immediate and swift action. HRD Antwerp has filed an official complaint with the local authorities and legal action against all parties involved, both internally and externally, has been taken.
Responding to claims by illegal diamond miners searching for stones outside De Beers' property in Kimberley, South Africa, that De Beers is a willing buyer of their diamonds, Corporate Communication Manager Tom Tweedy yesterday denied any involvement on the part of the company, emphasising that the purchase or sale of such diamonds would be in violation of the Kimberley Process (KP).
After years of discussion between the Antwerp diamond industry and the Belgian Government, in 2015 it was decided to introduce the “Diamond Regime” tax system, pending European Commission approval. Today the EC announced that the fiscal regime does not constitute State aid, and gave the green light to what has come to be known as the "Carat Tax". Implementation of this new tax regime will put an end to complex discussions between the Antwerp diamond industry and tax authorities on the control and valuation of diamond traders' stock.
ALROSA, the world leader in diamond mining, has become a member of the Responsible Jewellery Council (RJC) since 11 August 2016, writes RJC in a press release. "Consumers around the world are giving great importance to the origin of diamonds in jewelry. We believe it is important to demonstrate to the consumer that diamond mining is a socially responsible business that creates jobs, supports local communities and cares about the environment.
Andrey Polyakov, President of the World Diamond Council and Vice-President of ALROSA, sat down for an interview with Interfax (translation published exclusively by Rough-Polished), covering everything from the work and mission of the World Diamond Council (WDC), the Kimberley Process (KP), the Diamond Producers Association (DPA) and consumer demand for complete information about jewelry, to the possibility of ALROSA joining the Responsible Jewellery Council (RJC), setting up a diamond tracking program in China and the consumer markets in India, Brazil and the United States
RJC Press release: The Alliance for Responsible Mining (ARM) and the Responsible Jewellery Council (RJC) renewed their Memorandum of Understanding (MOU) to strengthen their collaboration in promoting and facilitating responsible jewellery supply chains.
We at ABN AMRO support initiatives that create more insight into the value chain, its key players, engages with the right side of the market and excludes areas which show less transparency or no willingness to learn and improve. We see other banks doing the same more and more. In the end there will only be credit lines available for companies with good corporate standards and track record, whether they are small or big doesn't matter ... We expect more consolidation and certain companies going out of business. It's a healthy development, where only strong and modern companies can survive, particularly those that look at innovation and diversification.
- Erik Jens, Head of Diamond & Jewellery Clients - ABN AMRO, on diamond industry initiatives to promote transparency, sustainability, CSR & responsible sourcing, interview with Rough-Polished.
The Zimbabwe Independent today published an opinion piece accusing the government and the Zimbabwe Consolidated Diamond Company (ZCDC) of everything from violation of property rights to compliance failures, lack of transparency and failing to meet promised revenue targets due to the very low prices received for their diamonds.
The World Diamond Council (WDC) today has elected Stéphane Fischler as Vice President and Ronald (Ronnie) VanderLinden as Treasurer. Udi Sheintal is to remain as Corporate Secretary. At the first meeting of the term, WDC’s Board of Directors elects officers from among its members for two-year terms. Stéphane Fischler, a founding and charter member of the WDC since its inception in 2000, was also recently re-elected President of the Antwerp World Diamond Centre, an appointment he has held since 2012.
Diamond traders of Mahidhapura and Varachha diamond markets have taken a unanimous decision to expose defaulters active in the industry and to sever business links with those who have defaulted in the last one-and-a-half-year, writes Times of India. Traders held a meeting with Surat Diamond Association (SDA) on Sunday to discuss this move. The traders also decided to close safe deposit vaults at 7:30 pm, curbing the use of promissory notes and discouraging credit transactions.
Representatives of the European Union (EU) and India participating in the KP Intersessional which took place in Dubai from May 23-26 presented a co-ordinated proposal under which the EU will be KP Vice-Chair in 2017 and KP Chair in 2018, while India will become KP Vice-Chair in 2018 and assume the position of KP Chair in 2019.
The situation in Zimbabwe's diamond mining industry following the recent forced closure of seven mining companies and the subsequent merger of their assets into the Zimbabwe Consolidated Diamond Company (ZCDC) has gone from poor to positively chaotic, insiders say.
The system at the Israeli Diamond Exchange in Ramat Gan is built on trust, yet the arrest of veteran diamantaire Hanan Abramovich triggering an investigation into accusations that he defrauded fellow traders of $65m worth of money and stones, writes Financial Times, threatens to have a direct effect on traders who have allegedly lost out.
Award-winning news director of JCK Rob Bates, in his opinion piece "Why the NGOs and Dubai Still Can’t Get Along", addresses the persistent conflict between Kimberley Process (KP) chair UAE and the KP civil society coalition - the group of 11 human rights groups that participate in the KP - that is threatening to turn the upcoming KP interessional meetings into a failure: "the recent turn of events looks like we are in for another year of stagnation and animosity, and the scheme will once again fail to make needed improvements, despite the UAE’s promises last year of a fruitful, pr
Following a series of defaults that rocked the industry since January 2016, involving amount to the tune of over $60mn by parties in Mumbai and Surat, the Surat Diamond Association (SDA) has urged diamond traders and manufacturers in Surat to implement 'know your customer (KYC)' norms before dealing in precious diamonds with anyone, reported the Times of India.
The Diamond Development Initiative (DDI), an organization dedicated to improving the working conditions and lives of artisanal diamond miners, is announcing the launch of the Maendeleo Diamond Standards (MDS), the organization anounced today in a press release. Maendeleo, the Swahili word for development and progress, is a fitting designation for standards that will ensure respect for human rights, for the environment and for community well-being, according to Dorothée Gizenga, Executive Director.
The Kimberley Process has sent an announcement warning its members of yet another fake KP certificate from Sierra Leone, the second in two weeks. The Focal Point of the United Arab Emirates reports that the UAE KP Office was contacted by a client prior to the import of a shipment to check the authenticity of a scanned copy of a KP Certificate from Sierra Leone. The UAE KP Office contacted Sierra Leone who confirmed via email that the attached copy is a false certificate.
A copy of the fake certificate is in annex.
Venezuela concluded a week of meetings with representatives of the Kimberley Process on Friday in what has been hailed as the final steps towards the South American country’s recertification as an international producer of non-conflict diamonds, reports venezuelanalysis.com.
The 2016 Kimberley Process (KP) Chair issued a communication dated 14 April informing all KP Participants and Observers that the Central African Republic region of Berberati in the southwest of the country has been declared a "Compliant Zone" as per the requirements of the Administrative Decision and Operational Framework for Resumption of Exports of Rough Diamonds from the Central African Republic (CAR). The KP Monitoring Team for CAR is currently in the process of agreeing with the country's KP Authority on a schedule for the team's monthly inspections of export shipments from Berberati.
GEMKonnect takes a look at the intial fallout from the 42-day jewelers strike that provisionally ended last week. One short-term consequence is that, "Jewelers in the northern Indian state of Uttar Pradesh, who reopened their retail outlets after the 42-day jewelers strike was called off, are reporting that they are unable to meet customer demands as there is currently an acute shortage of artisans to fabricate jewelry. The jewelry artisans, many of them daily wage earners, have reportedly returned to their villages as they were unable to stay in cities without any income.
The Antwerp World Diamond Centre has forwarded an alert from Kimberley Process authorities about a fake KP certificate issued from Sierra Leone. The warning reads:
At the end of March, Apple released its third Conflict Minerals Report. Often these reports get praised when companies describe themselves as having achieved a “conflict free” status. Apple’s report, however, chooses not to use this description, and we think that’s a good thing. This term ... can be misleading. The reality is that supply chains, particularly in conflict-affected and fragile states, are fluid and ever-changing. This means that even the most well-managed supply chains are not immune to the possibility of contributing to human rights abuses or corruption. It’s for this very reason that we don’t believe that supply chains or the final products should be definitively described as “conflict free” ... The most important [thing] isn’t a passive “conflict free” label; it is the evidence that companies are actively, continually checking their supply chains to look for red flags and risks, and when necessary, taking the appropriate steps to address these problems.
- Global Witness blog, "Why it's a good thing that Apple isn't declaring its products conflict free"
Reports from multiple sources are starting to detail the murky structures hiding the tremendous wealth accumulated by certain players in the diamond and gold trade that emerged through last week's release of the Panama Papers.
The United Arab Emirates received a shipment from Cameroon, which was declared to the UAE Customs. Upon inspection they noticed that the KP Certificate accompanying the shipment was fake. Cameroon authorities confirmed this. The document was uploaded on the restricted side of the KP website as well. The KP has therefore called on all its members to be vigilant regarding shipments of rough diamonds accompanied by a Cameroon KP certificate.
An UAE-sponsored initiative aimed at standardising pricing mechanisms for the rough diamond trade is due to be launched later this year under the country’s chairmanship of the Kimberley Process, reports UAE daily The National. Some may view this move as ironic, as it comes in response to criticism of trade and transfer mispricing practices within the diamond trade, which NGOs claim has deprived diamond producer states of crucial tax revenue - and UAE is considered the main practitioner of transfer pricing.
Pending a positive recommendation by the Kimberley Process (KP) monitoring team - consisting of representatives of the various KP working groups and civil society - after consideration of the results of their review visit to the Central African Republic (CAR), the resumption of rough diamond exports from CAR is looking increasingly possible.
Diamonds are an emotional product and it is our collective responsibility as an industry to provide consumers with confidence in the diamonds they purchase. De Beers supports robust and aligned standards in the jewelry industry that ensure that the supply chain is monitored and provenance is assured. We are therefore pleased that our sightholders can demonstrate compliance to the Responsible Sourcing Protocol for Diamonds through the Best Practice Principles.
- Head of government and industry relations for De Beers, Feriel Zerouki on De Beers and Responsible Jewellery Council backing Signet's Responsible Sourcing Protocol for Diamonds
There is need to urgently come up with effective interventions to rein in chaos ignited by the order for the miners to immediately stop operations. It is not a secret that what transpired [in the chaos of years gone by] damaged the country's image ... we should not invite this upon ourselves again at a time when Zimbabwe has more pressing issues ... The U.N. has placed embargos on conflict diamonds, a tag Zimbabwe's enemies can easily place on the country if the situation in Chiadzwa is allowed to spiral out of control ... It is against this background [Kimberley Process and Clean Diamond Act] that Government must do all in their might to ensure that no room is left for Zimbabwe's diamonds to be labelled conflict diamonds.
- Editorial in Zimbabwe Herald after reports of looters storming Marange diamond fields following government order for miners to close
Alibaba, the leading e-commerce portal for global wholesale trade blacklisted and removed a New Delhi-based supplier of synthetic diamonds and gem simulants after it tried to sell lab-grown diamonds with fake Gemological Institute of America (GIA) natural diamond certificates. The New Delhi-based seller identified as International Trading Corporation (ITC) had put up the wholesale offer to supply 10,000 carats of CVD diamonds a week with the GIA certifi
The National reports that UAE is ready to back a bid by Venezuela to return to the international diamond trading community, said Ahmed bin Sulayem, chairman of the Dubai Multi Commodities Centre, after a series of meetings in the country. Mr bin Sulayem is the new chairman of the Kimberley Process (KP), the regulatory regime for the global diamond trade. Venezuela, rich in the gems but facing a financial meltdown as a result of low oil prices, wants to resume diamond trading after a seven-year halt.
Belgian anti-money laundering legislation requires not only banks, but also diamond traders to identify their clients, verify their identity and conduct a risk analysis before proceeding to a transaction. In this regard, Belgium is stricter than other European Member States.
Transparency International (TI) is a NGO that monitors corporate and political corruption in international development. Its Corruption Perceptions Index (CPI) ranks countries based on how corrupt their public sector is perceived to be. It is a composite index drawing on corruption-related data collected by a variety of reputable institutions, based on views of observers from around the world.
The Financieele Dagblad (Netherlands) takes a look at the level of transparency in the small and middle-sized diamond trade in Surat, India, concluding that traders on the local market still turn a blind eye to demands for official invoicing. The little paper envelopes with scribbled details of the contents and price – so familiar in the diamond trade – are the only paperwork to be found at the dusty street-side Hira Bazar (diamond market) in Surat. “This is how we do business worth millions of rupees,” says local dealer Prakash Kathri.
Amnesty International has published a new report, together with Afrewatch (Africa Resources Watch): “This is What We Die For: Human Rights Abuses in the Democratic Republic of the Congo Power the Global Trade in Cobalt”, traces the sale of cobalt used in lithium-ion batteries from mines where children as young as seven and adults work in perilous conditions. It claims that major electronics brands, including Apple, Samsung and Sony, are failing to do basic checks to ensure that cobalt mined by child laborers has not been used in their products.
UAE's Ministry of Economy (MoE), and the Dubai Multi-Commodities Centre (DMCC) have signed a Memorandum of Understanding (MoU) to support and enhance cooperation and coordination between the two sides concerning the supervision of imports, exports and transit of rough diamonds to and from the country, in line with the Kimberley Process Certification Scheme (KPCS) on the international trade of rough diamonds and in accordance with European Union Law. The MoU is part of joints efforts by the MoE and DMCC to ensure optimal implementation of the KPCS, under which official certificates are issue
The Belgian authorities at AWDC’s Diamond Office have alerted the Kimberley Process team about a fake KP certificate from Sierra Leone that was confirmed by the Sierra Leone authorities. The KP has therefore called on all its members to be vigilant regarding shipments of rough diamonds accompanied by a Sierra Leone KP certificate. As for the certificate itself: the numbering on the certificate (4306) was a number range used in 2014. The parcel number is also incorrect. This number always ends with the certificate number; in this case it ends with the number 4911(JMI/GGDO/4199).
Pope Francis - in a speech on 26 November in Nairobi, Kenya to the regional UN headquarters during his first official trip to Africa - said that illegal trade in diamonds and other precious stones and metals, as well as the poaching of elephants for their ivory tusks, “fuels political instability, organized crime and terrorism.” He said that, “This situation is a cry rising up from humanity and the Earth itself, one which needs to be heard by the international community.” He also stated that, “We cannot be silent about forms of illegal trafficking which arise in situations of poverty and in
The World Diamond Council (WDC) has issued a press release following the Kimberley Process (KP) Plenary Meeting held in Luanda, Angola last week, reasserting the importance of the tripartite foundation of the KP and reiterating that no conflict diamonds should, under any circumstances, enter the legitimate diamond trade.
This week's Kimberley Process Plenary in Angola has not been without its share of controversy, with civil society announcing that it will not participate in a UAE-led KP in 2016 and World Diamond Council (WDC) President Edward Asscher welcoming the criticism (when justified) as well as participation of the NGOs.