Q. What is the role of the JVC in representing the industry in negotiations about import tariffs?
The Jewelers Vigilance Committee’s role is focused on providing legal compliance education and guidance to our membership and the jewelry industry at large. We do not lobby as a general practice, but we do advocate for the industry at the federal agency level to ensure that the rules and regulations that apply to the industry are fit for purpose. Our main goal throughout the last four months of the shifting U.S. tariff policy has been focused on keeping the trade up to date on the current rates and the temporary import options for trade shows. We also launched our Tariff Tracker, available to the entire industry here: https://jvclegal.org/tariff-tracker/.
Q. Are there other jewelry and diamond organizations lobbying the authorities about the tariffs and is there coordination?
There are three efforts that I know of: the World Diamond Council, Jewelers of America, and the American Gem Trade Association have all launched efforts to seek exemptions for the industry.
Q. Has any progress been made in the attempt to get diamonds exempted from the tariffs?
You would have to ask them this question!!
Q. Since the agreements are being made vis a vis individual countries, does that mean that a diamond found in Africa, polished in India, but exported from Israel might have a different level of tariff placed on it from a diamond exported from Belgium? What are the considerations? Is origin of the rough diamond a factor? Where it is polished? The balance of trade between the US and the exporting companies? What about rough diamonds imported into the US?
Tariffs are assessed based on a product’s country of origin, not the country of export. In the case of diamonds, the country of origin is typically the country where the rough diamond was mined or extracted. However, this designation can change if the diamond undergoes a substantial transformation in another country.
For example, if a rough diamond is mined in South Africa and exported directly to the United States in its uncut form, its origin remains South Africa, and the applicable tariff would be based on South Africa’s rate. Conversely, if that same rough diamond is sent to India to be cut and polished before being exported to the U.S., the cutting and polishing process is considered a substantial transformation. As a result, the country of origin shifts to India, and the Indian tariff rate would apply.
Importantly, while cutting and polishing a diamond constitutes a substantial transformation, setting a polished diamond into a piece of jewelry does not.
Q. You had mentioned two court cases that were pending that had something to do with tariffs or regulations concerning diamonds. Can you provide information on these cases and how they might relate to diamonds imported into the US?
President Trump is using the International Emergency Economic Powers Act (IEEPA) as the authority to declare emergencies and enact broad tariffs without being subject to hearings or congressional review. Both legal challenges center on whether the president can use IEEPA to impose sweeping tariffs without congressional approval.
In the first case, V.O.S. Selections, Inc. v. United States, the Court of International Trade ruled in favor of the plaintiff, a wine distributor. The government has appealed the judgment to the Federal Circuit Court of Appeals, which issued a stay of the decision while the case is undergoing appeal. The appellate hearing is scheduled for July 31.
In the second case, Learning Resources, Inc. v. Trump, two Illinois-based educational toy companies challenged the same tariffs in the D.C. district court. They asserted that Trump overreached emergency powers and bypassed congressional authority to levy tariffs. A federal judge agreed, blocking tariff enforcement in their case, but not extending that to everyone. The government has appealed, and the plaintiffs asked the Supreme Court to fast-track the decision. The Supreme Court declined in June, meaning that the case will move through the regular appeals process.
Q. The sanctions on Russian diamonds were the top story not too long ago. Do you have any idea when or if the US will demand proof of traceability on diamonds imported into the US?
We don’t yet know what the U.S. policy will be on diamond traceability going forward. It would be foolish to say the environment or appetite is the same since the government has shifted significantly since the G7 began work on this issue. However, the import ban on Russian goods 0.5 carats and higher is still in place, and businesses are required to file a self-certification statement for which they can provide back up evidence if requested. A traceability mechanism is one way to back up that information, and so I still think there is value in pursuing it.
Q. France has reasserted that lab grown diamonds must be called synthetics in their country. Is there any possibility that the US might adopt this policy?
The Federal Trade Commission will not revisit the guidelines around laboratory-grown and other jewelry terminology until the next revision of the Jewelry Guides, which will not be scheduled until 2028 or later. That doesn’t mean there is nothing to do! The FTC only makes these kinds of changes when it can show the wording is causing consumer deception. The term synthetic is not banned from use in the U.S., but it is not recommended either. If the industry wants to advocate to reintroduce the word synthetic as a recommended term for laboratory-grown diamonds, it will need to provide consumer perception data supporting the change.
