South Africa Reopens De Beers Probe

South African lawmakers on Tuesday ordered the country’s national treasury to seek a legal opinion on whether De Beers evaded export duties when shipping gems to London in 1992, according to news reports.

Themba Godi, chairman of South Africa’s parliament’s public accounts committee, has called for the South Africa Department of Minerals and Energy and the South African Reserve Bank, with the assistance of the country’s auditor-general, to set up a task force to investigate De Beer’s records, Bloomberg News reports. Progress reports must be submitted to parliament within 60 days.

The team will look at stockpile records from Dec. 3, 1992, to March 19, 1998, which a top official told Reuters news service amounted to about 1 billion rand (approximately $129 million).

South Africa’s government alleged in 2005 that De Beers may have evaded $135 million of duty when shipping 20 million carats of diamonds to London, Bloomberg reports. While a law allowed De Beers to export gems duty free, on condition it re-import stones for local cutters, company figures don’t tally, the government has said.

De Beers will give its “full cooperation” to the enquiry, spokesman Tom Tweedy told Bloomberg News. “It’s pretty clear to us” that we acted within the law, he added.

The audit used by the auditor-general to question the size of its duty exemption was incorrect and De Beers could provide Diamond Board exemption certificates for all shipments, the Johannesburg-based company reportedly said on Sept. 12 last year.

Wally van Heerden, an official with the auditor-general’s office, said at the time that it was unclear whether De Beers’s exemption from duty was legal, Bloomberg reports.

De Beers has strongly denied that exports in the mid-1990s were larger than normal or that it had benefited from improper exemptions of export duties, Reuters reports.

Follow JCK on Instagram: @jckmagazine
Follow JCK on Twitter: @jckmagazine
Follow JCK on Facebook: @jckmagazine
JCK logo
JCK

Log Out

Are you sure you want to log out?

CancelLog out