FTC Asks for Comment on Lower-Content Platinum

July 5, 2005

Kimberley Process Reviewed in U.S.

A six-person international delegation representing the Kimberley Process Certification Scheme met recently with the U.S. government and the diamond and jewelry industry for the first peer review of how the U.S. is implementing the program.

Each participating country in the Kimberley Process has agreed in principle to host a review team to assess implementation of the scheme, which works to ensure tainted diamonds that fuel conflict don't enter the legitimate rough diamond trading system. Eighteen reviews have already taken place, including the visit to the U.S.

The three-day meeting held June 28-30 in New York and Washington focused on how the government was complying with the formal KPCS and how the diamond industry's World Diamond Council was following through with its voluntary System of Warranties, introduced to ensure the entire industry, down to retailers, was checking to ensure no conflict diamonds were being sold. (The KPCS only certifies rough diamonds; the System of Warranties follows diamonds after that point).

The KPCS delegation was comprised of members representing three Kimberley Process participants, the World Diamond Council and non-governmental organizations (human rights groups that monitor the Scheme and System of Warranties). They included: Team Leader Serguei Oulin, vice president, Alrosa, representing the Russian Federation; Sergey Panchekhin, member of the KPCS Secretariat; Jacqueline Lenka, chief diamond inspector, South Africa Diamond Board; Clive Wright, first secretary, British Embassy, representing the European Community; Yair Cohen, managing director, Israel Diamond Exchange, representing the World Diamond Council; and Ian Smillie, Partnership Africa Canada, representing NGOs.

The U.S. Kimberley Process Authority hosted the meeting at the New York Diamond Dealers Club. The USKPA, along with the federal government, is responsible for oversight of trade compliance with the Kimberley Process in regard to the export of diamond rough from the U.S. The three directors of the USKPA are Chairman Martin Hochbaum of the Diamond Dealers Club; General Counsel Cecilia Gardner, JVC; and Secretary Mark Gershburg, Gemological Science International.

The Peer Review agenda included an overview of USKPA procedures by Cecilia Gardner and a presentation by JA President Matthew Runci on the trade initiatives to ensure the System of Warranties. Speaking on behalf of the U.S. government were Rochelle Stern, chief, policy planning and program management, Office of Foreign Assets Control, U.S. Treasury Department; Stan Specht, special advisor for conflict diamonds, U.S. State Department; C. Harvey Monk, chief, foreign trade division, and Kristen Nespoli, supervisor, commodity analysis branch, U.S. Bureau of the Census.

The Peer Review also included a visit with U.S. Customs at JFK airport to have a first-hand look at the operations for the import and export of rough diamonds. It was followed by a meeting with Malca-Amit, which is one of 14 companies licensed by the USKPA and the U.S. Transportation Security Administration to ship rough diamonds.

Following visits with other members of industry in New York City, including ABN Amro Bank and Lazare Kaplan International, the Kimberley delegation finished their review in Washington, where they met with members of the State Department, the U.S.K.P. Interagency Implementation Coordinating Committee, and other NGOs. The team will produce a draft report on its visit.

The Kimberley Process was established by governments, industry, and NGOs to control the export and import of rough diamonds across borders in order to eliminate the traffic in "conflict diamonds." It went into effect on January 1, 2003. Presently there are more than 40 participants, plus the European Community.

For more information about the Kimberley Process and the voluntary System of Warranties, contact Martin Hochbaum at the Diamond Industry Steering Committee at 212-869-9777. Or visit www.kimberleyprocess.com or www.jewelers.org.

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