Compromise Reached on ‘Conflict Diamonds’ Legislation

Following seven months of often bitter squabbling, the industry and its critics are on the same page regarding conflict diamonds.

The World Diamond Council, Rep. Tony Hall (D-Ohio), and Hall’s allies at nongovernmental organizations (NGOs) recently hammered out a compromise version of the “Clean Diamonds Act,” legislation originally introduced by Hall in the House. Senators Russ Feingold (D-Wis.), Richard Durbin (D-Ill.), and Michael DeWine (R-Ohio) will introduce the rewritten bill in the Senate.

All sides hailed the deal, since the industry’s support exponentially increases the bill’s chance of passage. The bill still must win the approval of the Bush administration, which at press time had not yet stated its position. Hall spokeswoman Deborah DeYoung said that, ideally, the legislation will pass as a freestanding measure, although there’s always “the temptation” to tack it on to an appropriations measure, as Hall did with a similar bill last year. The goal is to pass it by the end of the year.

“Hopefully, by the time the big diamond sales at Christmas occur, this bill will pass, and no one will have to worry about buying a conflict diamond,” said Rep. Frank Wolf (R-Va.), co-sponsor of the House bill, at a Washington press conference introducing the retooled act.

Many hope the industry will no longer be the target of NGO anger, but Rory Anderson of Christian humanitarian group World Vision warned that the industry had better fulfill its promise to back the bill. “The proof will be in the pudding,” she said. “Standing on stage is useful, but it’s only the beginning. Passing this bill requires legwork, and it will take the clout of the diamond industry to make that happen.”

Partly in response to NGO concerns, at a National Press Club forum the day after the press conference, Jewelers of America president and CEO Matthew Runci pledged there would be “no limits” on the amount of money the industry would spend to pass the bill. Even so, the Hall-NGO faction vowed to continue its “consumer awareness” campaign until the bill is passed. “We will continue to educate America and the world about conflict diamonds,” Hall says. Anderson says the NGOs will continue their protests, although the message could change now that the industry is on board.

“We’re not going to just pack up and go home,” she says. “The people of America have to want this bill to pass, and it takes more than a handshake with lobbyists to make that happen.”

At press time, the Web sites for both Amnesty International USA (www.amnestyusa.org) and World Vision (www.worldvision.org) still prominently featured information on conflict diamonds.

The compromise has led to some cooling of rhetoric. WDC chairman Eli Izhakoff thanked Hall for “making us all come together and for his leadership on this issue.” Adotei Akwei of Amnesty International said the diamond industry “has shown a new standard for accountability that other industries would do well to emulate.”

The agreement ends a sometimes-nasty spat that often seemed more about past grievances—particularly a prior compromise the industry didn’t support—than matters of policy. “I didn’t think we’d get a compromise,” Hall said at the press conference. “I thought hell would freeze over before I’d give on anything. We weren’t speaking and were so far apart. But it did come together and came together wonderfully.”

The negotiations—described as “civil and professional”—began in early June during The JCK Show in Las Vegas. Within a week, participants had drawn up the rough outline of an agreement, although the details continued to be fiddled with until shortly before the press conference.

Up until the press conference, the industry had backed a bill introduced by Sen. Judd Gregg (R-N.H.). Yet, as the battle wore on, some at the World Diamond Council felt that the dual-legislation strategy was flawed, and that the industry would be better off working with Hall than engaging in an endless quarrel. Some agreed with the congressman’s complaints that the industry had treated him shabbily.

Price sheet publisher and WDC member Martin Rapaport broke ranks at The JCK Show, publicly declaring his support for a rewritten version of Hall’s bill. Inter-trade pressure also forced industry negotiators to budge on several issues, particularly the crucial question of certifying diamond jewelry.

Hall’s people, too, were under pressure to cease hostilities, with the NGOs saying it was time for an “exit strategy.” They worried the campaign was about to “boil over” and seriously hurt the diamond industry—something they didn’t want to happen. It’s also likely that the trio of senators didn’t want to inherit a feud with the trade.

Cecilia Gardner, head of the Jewelers Vigilance Committee (JVC) and a member of the WDC legislative committee, believed the introduction of the Gregg bill tipped the balance. “It gave credence to the industry’s proposals,” she said. “I give a lot of credit to Senator Gregg for that.” The bill does appear to have convinced the skeptical NGOs that the industry was serious about rough controls—especially after it incorporated NGO objections to prior drafts. “For the first time, the industry was on record as supporting serious legislation,” said Holly Burkhalter of Physicians for Human Rights.

The new ‘Clean Diamonds Act.’ The modified “Clean Diamonds Act” is mostly patterned after the bill Hall introduced in March. It aims to speed progress on a worldwide rough certification system by letting only diamonds from countries with rough controls into the United States.

The new bill includes concessions from both sides. The industry agreed to include diamond jewelry in the bill—something to which it had previously objected. The new bill says jewelry producers who want to export to the United States must use stones procured from countries with rough controls. Under the old bill, jewelry producers would have been forced to install the controls themselves.

While the new bill requires that rough controls be in place within six months, it provides open-ended waivers for “cooperating” countries. Hall’s bill originally allowed six-month waivers only, but he compromised on this point to make the bill more compliant with U.S. obligations under the World Trade Organization.

The new bill eliminates a section to which the industry objected—that is, letting jewelers tag their products as “conflict-free.” Hall’s people said they were just responding to retailer requests, but the industry argued that such labeling would be unnecessary if all imports were conflict-free.

There are also new sections providing financial support for countries that have difficulty implementing the controls, a call on the diamond industry to assist these countries, and greater industry representation on the panel monitoring the process. Finally, the bill’s preamble was rewritten to give the industry more credit for devising a solution to the problem.

To see the full text of the bill, go to http://thomas.loc.gov, and enter “S1084.”