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Keep Alrosa Diamonds Separate, JVC Warns

February 28, 2023  |  Anthony DeMarco
Alrosa polished fancy color diamonds credit Alrosa used 022823

The US government will likely address a loophole that enables Russian stones to enter the country, according to the Jewelers Vigilance Committee (JVC).

The trade should begin segregating Alrosa diamonds from other goods in preparation for possible tighter sanctions, the legal guidance group said Monday in a member alert.

On Friday, the G7 nations pledged to “work collectively on further measures on Russian diamonds,” without explaining what these would be.

However, the JVC said the US’s focus would likely be the principle of “substantial transformation,” according to which a diamond’s origin is determined by where it was cut and polished rather than where it was mined.

This mechanism has allowed American companies to import Russian diamonds that were manufactured in India or other locations. It is associated with the 1940 case United States v. Gibson-Thomsen Co., in which the Court of Customs and Patent Appeals held that products took on a new identity as a result of further manufacturing or processing.

“The Jewelers Vigilance Committee (JVC) has received information that restrictions are likely to specifically target polished diamonds, regardless of where they are cut and polished,” the group’s alert continued. “Any suppliers abroad who are still purchasing diamonds from Alrosa will likely need to begin segregating those goods to ensure they do not reach the US market and should be prepared to make customs declarations that their goods do not contain Russia-origin products.”

The organization also urged US businesses to review their sourcing protocols, discuss requirements with suppliers, and evaluate their supply chains.

Creating and implementing regulations will take a few months, said Tiffany Stevens, the JVC’s CEO and general counsel. The New York-based organization will work with the US Department of State and other government partners to make sure the industry is informed of its responsibilities, she added.

“In the meantime, JVC will continue to educate the trade on its role in ensuring that US dollars do not go to fund the ongoing unjustified war in Ukraine,” Stevens said.

Image: Fancy-color diamonds from Alrosa. (Alrosa)


Alrosa polished fancy color diamonds credit Alrosa used 022823 Keep Alrosa Diamonds Separate, JVC Warns

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