A multi-faceted approach that combines accurate definitions with efficient detection is essential to establish two clearly distinct pipelines for natural diamonds and synthetics, panellists at a Special Forum on Diamond Terminology held in Mumbai today said.

Speakers at the forum, organised during the ongoing KP Intersessional Meet that is taking place from June 17-21, 2019 in India, also opined that in addition, a special effort was needed to communicate this to consumers and strengthen overall confidence in the product, particularly in the US which is the world’s largest market for diamond jewellery.

The panel, comprising industry experts Sanjay Shah, GJEPC; Karla Basselier, AWDC; Igor Kalinin, Federal Customs Service of Russia; David Bouffard, Signet Jewelers and Elodie Daguzan, Rubel & Ménasché; was chaired by Peter Karakchiev, the chair of KP’s Working Group of Diamond Experts (WGDE).

Opening the discussion, Sanjay Shah, Convener, Diamond Panel of The Gem & Jewellery Export Promotion Council (GJEPC), emphasised that global industry bodies like CIBJO, WFDB, IDMA and other associations have unanimously agreed that only naturally created stones could be referred to as diamonds, notwithstanding the similar chemical composition of lab-grown synthetics.

He said that in India, the official regulatory body, Bureau of Indian Standards has a clear set of guidelines which are also aligned to ISO 18323, and that the Council advocates that all its members adhere to these. Shah also outlined the efforts taken by the GJEPC over the years including setting up of a Natural Diamond Monitoring Committee and a pioneering study of the synthetic diamond industry.

The Indian industry has focused on four key areas – Regulation, Commercial, Process and Technology – is its efforts to ensure that any attempt at mixing is easily detected and appropriate action taken in each case. On the Regulation front, the Council has interacted with the government seeking to develop a clear policy framework as well as distinct HS Codes and put in place separate structures for duty and taxation. On the commercial side, trade bodies are imposing penalties and establishing safeguards against mixing, while in terms of Process, the industry is trying to develop protocols for self-declaration, random testing and screening. The latter is based on technology, and the Council has worked with its associate the Gemmological Institute of India (GII) to develop affordable detection devices and deploy them effectively across the pipeline.

Shah said that the Council has proposed that the government should expand the HS Codes beyond the existing ones for polished synthetic diamonds (recently implemented in India) to cover trade in rough synthetic diamonds and even synthetics studded in jewellery and other items.

Karla Basselier, representing AWDC gave a brief overview of the existing regulations in Antwerp regarding the trade in natural and synthetic diamonds. She noted that official decree mandates unambiguous disclosure of the nature of any diamond and that fraudulent statements are strictly prohibited. She also pointed out that the Diamond Office closely supervises the trade with the help of experts and high tech devices, to prevent mixing.

Karla said that some of the other European countries do not have similar rules. In Germany, for example, there are ongoing judicial proceedings in some cases, while in Italy, a new legislation has been submitted to the government and is awaiting approval.

She informed the gathering that from January 1, 2020 the EU will be implementing a separate 8-digit CN code for synthetic diamonds at Customs which will be in force till the implementation of a HS Code by the World Customs Organisation which is expected to take place from January 1, 2022.

Igor Kalinin from the Customs Service of Russia too assured the KP members that the system of checks and controls in his country, with Customs offices run by trained personnel using available high technology, was able to ensure separation of the two pipelines.

Commenting on the situation in the US, David Bouffard of Signet Jewelers opined that the FTC guidelines still mandated that lab grown diamond producers clearly communicate the origin of their product, and also desist from any general statements about these products being more ‘eco-friendly’ or ‘clean’. However, he said that there was a section of the LGD producers that were trying to take advantage of ‘certain weaknesses in the KP system’ to spread misinformation about natural diamonds.

Bouffard said that Signet specifically trains all of its 30,000 retail employees to answer questions about ‘conflict’ or ‘blood’ diamonds and dispel any misgivings in the minds of consumers regarding the role that the diamond industry plays. But, staff of the hundreds of independent jewellers across the country were not receiving similar training, thus impacting the communication across the “last 18 inches” of the pipeline.

He called on KP delegates to address these issues, and support the retailers in the US and other markets in various ways. “We need to communicate the positive impact that the diamond industry has in so many producing countries, we need to strengthen the voices of bodies like Diamond Empowerment Fund and Diamond Development Initiative and take their message that ‘Diamonds Do Good’ to every consumer,” Bouffard emphasised.

In a similar vein, Elodie Daguzan, representing French diamantaire Rubel & Ménasché, said that it was up to the industry to ensure that consumer confidence in the product remained strong by going beyond terminology to establish reliable procedures too. The interests of the industry were aligned with those of the ‘coalition’ of the biggest diamond jewellery brands – Richemont, LVMH, Kering, Chanel, Hermes -- who are all interested in maintaining consumer confidence and their brand equity. It was necessary to establish Quality Assurance protocols all across the pipeline, she emphasised.

During the brief discussion that followed, various members of the participating country delegations voiced opinions on what could be done to proactively involve their governments in promotions which would strengthen the diamond industry. An innovative suggestion – to set up a Working Group on Promotions and Consumer Confidence within KP, received strong applause from the delegates.

Pic caption: Panelists at the KP Special Forum on Diamond Technology (from l) Peter Karakchiev, WGDE Sanjay Shah, GJEPC; Karla Basselier, AWDC; Igor Kalinin, Federal Customs Service of Russia; Elodie Daguzan, Rubel & Ménasché and David Bouffard, Signet Jewelers