Sunday, July 7, 2024

Jewelers of America Takes Russian Diamond Import Concerns to Washington

New York—Jewelers of America (JA) recently led a delegation of industry leaders to Washington, D.C., to address the impending U.S. import restrictions on Russian diamonds with lawmakers. The discussions focused on an EU proposal mandating that all rough diamonds of 0.5 carats and above destined for G7 nations pass through a single import channel in Belgium starting September 1.

The delegation, spearheaded by JA President and CEO David Bonaparte, included Jon Bridge, Chair/Counsel Emeritus of Ben Bridge Jeweler; Dave Meleski, President and CEO of Richline Group; Matthew Swibel, Vice President of Sustainability and Social Impact at Signet Jewelers; and Ronnie VanderLinden, former President of the Diamond Manufacturers & Importers Association of America and the International Diamond Manufacturers Association.

The group met with numerous Democratic and Republican lawmakers from both the House of Representatives and the Senate who oversee trade issues. They conveyed that the proposed system for physical verification and certification of rough diamonds in Belgium would significantly disrupt the global diamond and jewelry supply chain while having minimal impact on Russia’s diamond revenue.

In March, U.S. Customs and Border Protection (CBP) issued guidance on importing polished diamonds weighing 1 carat or more into the U.S., coinciding with new G7 restrictions on diamonds mined but not cut in Russia. Expanded regulations, effective September 1, will lower the size threshold to 0.5 carats and extend import rules to finished jewelry, lab-grown diamonds, and watches.

The G7 technical committee is currently developing a traceability plan to monitor and restrict the circulation of Russian rough diamonds, proposing Antwerp, Belgium, as a key node for uploading diamond data onto a blockchain for source verification.

The Jewelers Vigilance Committee’s Sanctions resource page notes that the logistics of tracking and moving goods from source countries to the node remain uncertain. JA and its allies argued that the EU proposal’s financial, operational, and supply chain repercussions are too severe for the U.S. to accept.

The delegation emphasized that the new import requirements could lead to significant supply chain disruptions and increased costs for American consumers. Bonaparte highlighted JA’s efforts to mitigate these disruptions, stating, “We are very concerned about the additional requirements that could take effect on September 1, including adopting a European Union proposal that would force all G7/U.S.-bound diamonds of a half a carat and above through a single import channel in Belgium.”

The group also lobbied for a “grandfathering” clause for diamonds and diamond jewelry imported into the U.S. before March 1, 2024, to protect the value of consumer-held and industry inventories.

Additionally, the delegation advocated for maintaining the attestation of rough and loose diamonds and current certification systems at the producer-country level. They called for clearer guidance to ensure that the current 1-carat import restrictions apply only to individual loose diamonds, not the total weight of diamonds in finished jewelry.

JA reiterated its support for keeping Russian-origin diamonds out of the supply chain and urged its members to use JA’s Legislative Action Center to voice their concerns to Congress about the proposed restrictions.

JA will host its annual fly-in on September 18, offering members a chance to meet with their congressional representatives to discuss these and other key issues. The day before, on September 17, JA will hold one of its Multifaceted Learning Workshops at The Army & Navy Club.

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Alice
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