De Beers and Alrosa Sign Agreement to Reduce Sales


May 10, 2006

De Beers and Alrosa Sign Agreement to Reduce Sales

De Beers and Alrosa inked an agreement Wednesday that began a reduction in trade between the them, formalizing De Beers' commitment to the European Commission (EC) that it would stop buying diamonds from the Russian company by 2009.

Under the agreement, De Beers' purchases of rough diamonds from Alrosa will decrease from $600 million in 2006 to $500 million in 2007, and then to $400 million in 2008, according to the EC. Annual sales to De Beers have averaged $800 million under the trade agreement initially signed between the companies for the period 2002-2007.

After an investigation initiatied in 2002, the EC ruled that De Beers' trade agreement with Alrosa violated European Union anti-trust laws.



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