The World Diamond Council (WDC) which has prepared a System of Warranties (SoW) Toolkit is calling upon industry stakeholders to review it and revert to the body with comments if any.

Earlier, the SoW Toolkit was  unanimously adopted “as a working draft” by the WDC Board of Directors; and was also reviewed by WDC members.

“The SoW Toolkit, which once released will be made available online at no cost to the industry, (and) is designed to assist members of the diamond trade comply with the revised WDC SoW that was approved in 2018 and is scheduled to be phased in over a five-year period,” the WDC said when making the announcement.

WDC has said that stakeholders who wish to review the toolkit can download a copy from its website; and that comments on it will be accepted  no later than March 31, 2020.

The SoW was first introduced in 2002, as an industry self-regulation system that requires buyers and sellers of diamonds to pass on a warranty statement on B2B invoices and memos each time a stone changes hands, assuring the next buyer that they originated from sources in compliance with the Kimberley Process Certification Scheme (KPCS).

“Unlike the KPCS, which only covers the trade in rough diamonds, the SoW also applies to the trade in polished diamonds and jewellery set with diamonds,” WDC said clarifying aspects of its new system. “Additionally, it must be applied each time a diamond changes hands, in contrast to the KPCS, where certificates are issued only when rough diamonds are exported from one country or region to another.”

The revised system is based on new SoW Guidelines, which were approved in 2018 and reference  the following “universally recognised” documents:

• Kimberley Process Certification Scheme (KPCS) Minimum Requirements and Recommendations on industry self-regulation issues;
• UN Guiding Principles on Business and Human Rights;
• UN Convention Against Corruption;
• FAFT 40 Recommendations on Money Laundering for Dealers in Precious Metals and Stones; and
• ILO Declaration on Fundamental Principles and Rights at Work.

WDC added that the SoW Toolkit under review  is a “self-assessment questionnaire”, where the questions that need to be answered depend upon the business model of the respondent and number of employees at work in the firm. “This flexibility will ensure that respondents need to react to questions that are relevant to their businesses,” WDC emphasised. “The SoW self-assessment must be completed by every company that includes the revised SoW statement on their invoices, and it will need to be done annually.”

The following are the sections which need to be filled by respondents – either all or some of them, depending on the nature of the business: 

Section 1: KPCS Section, for companies who deal (i.e. buy or sell) rough diamonds;

Section 2: SoW Section, for all companies;

Section 3: Compliance Section, for all companies, although firms with more than 100 employees will be required to respond to more questions than their smaller counterparts; and

Section 4: Companies who source rough from artisanal mining operations.

“The stakeholder review is the final stage in the rollout of the new SoW Toolkit, and is a most critical one,” explained WDC President Stephane Fischler. “Our goal is to strengthen the System of Warranties, and in so doing reinforce the integrity of the diamond distribution chain. For this we are seeking the perspective of a range of experts. I call our colleagues to contribute.”