SourcingFeb 15, 2022
Supply Constraints Impact Alrosa’s January Sales Policies & IssuesFeb 25, 2022
Alrosa Lands on US Sanctions List After Russia Invades Ukraine
The sanctions are not a total ban on doing business with Alrosa in the U.S., but they still will have an impact on the jewelry industry.
Washington, D.C.—The U.S. government has sanctioned diamond miner Alrosa as part of its efforts to punish Russia after its invasion of Ukraine Thursday.
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) released an extended list of sanctions on Thursday, building on those imposed earlier this week to target the Russian financial system, including all its largest financial institutions and the ability of state-owned and private entities to make money.
Named on the list is Alrosa, the world’s biggest diamond producer by volume, mining 32.4 million carats in 2021 with sales topping $4 billion.
The diamond miner is listed under Directive 3 under E.O. 14024 from OFAC, which prohibits transactions and dealings by those in the United States in new debt of longer than 14 days or new equity of Russian state-owned entities.
In explaining its decision to sanction Alrosa, the U.S. Treasury said the company is responsible for 90 percent of Russia’s diamond mining capacity, which accounts for 28 percent globally.
The Russian government also holds a 33 percent stake in the company.
The sanctions are not an outright freeze on Alrosa’s assets, nor a complete ban on doing business with the company, the Jewelers Vigilance Committee explained.
They also do not apply to goods acquired from Alrosa or Alrosa USA before Feb. 24, 2022, though JVC recommends businesses hold on to records showing the date Russian-origin goods were acquired and pass along this information to customers if they ask.
What the sanctions do mean for the jewelry industry is that any open memo agreements with terms longer than 14 days should be amended to shorten the terms and/or closed, JVC said.
JVC also advises any U.S. business currently doing business with Alrosa or Alrosa USA should “evaluate the status of any transactions and work to ensure that their transactions do not violate the sanctions.”
The Treasury also launched new actions against influential Russians in President Vladimir Putin’s inner circle or in positions of power within Russia.
Among them is Alrosa CEO Sergey Ivanov Jr., added to the OFAC Specially-Designated Nationals list because he is the son of Sergey Ivanov Sr., a high-ranking Kremlin official who has been on OFAC’s Specially Designated Nationals list since 2014, and because he is a board member of Gazprombank, Russia’s third-largest financial institution and another sanctioned entity.
Related stories will be right here …
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) released an extended list of sanctions on Thursday, building on those imposed earlier this week to target the Russian financial system, including all its largest financial institutions and the ability of state-owned and private entities to make money.
Named on the list is Alrosa, the world’s biggest diamond producer by volume, mining 32.4 million carats in 2021 with sales topping $4 billion.
The diamond miner is listed under Directive 3 under E.O. 14024 from OFAC, which prohibits transactions and dealings by those in the United States in new debt of longer than 14 days or new equity of Russian state-owned entities.
In explaining its decision to sanction Alrosa, the U.S. Treasury said the company is responsible for 90 percent of Russia’s diamond mining capacity, which accounts for 28 percent globally.
The Russian government also holds a 33 percent stake in the company.
The sanctions are not an outright freeze on Alrosa’s assets, nor a complete ban on doing business with the company, the Jewelers Vigilance Committee explained.
They also do not apply to goods acquired from Alrosa or Alrosa USA before Feb. 24, 2022, though JVC recommends businesses hold on to records showing the date Russian-origin goods were acquired and pass along this information to customers if they ask.
What the sanctions do mean for the jewelry industry is that any open memo agreements with terms longer than 14 days should be amended to shorten the terms and/or closed, JVC said.
JVC also advises any U.S. business currently doing business with Alrosa or Alrosa USA should “evaluate the status of any transactions and work to ensure that their transactions do not violate the sanctions.”
The Treasury also launched new actions against influential Russians in President Vladimir Putin’s inner circle or in positions of power within Russia.
Among them is Alrosa CEO Sergey Ivanov Jr., added to the OFAC Specially-Designated Nationals list because he is the son of Sergey Ivanov Sr., a high-ranking Kremlin official who has been on OFAC’s Specially Designated Nationals list since 2014, and because he is a board member of Gazprombank, Russia’s third-largest financial institution and another sanctioned entity.
While the sanctions on Ivanov don’t necessarily prohibit transactions with Alrosa, JVC Deputy General Counsel Sara Yood said non-blocked entities controlled or led by blocked persons are at risk for further sanctions, as per OFAC.
She added that U.S. businesses considering transacting with companies controlled or led by sanctioned individuals should be sure they’re not making any missteps, such as inadvertently signing a contract with the blocked person.
As of press time, Alrosa had yet to issue a statement on the sanctions.
Thursday’s sanctions build on those levied earlier this week, when OFAC announced sanctions on two Russian banks, the Corporation Bank for Development and Foreign Economic Affairs Vnesheconombank (VEB) and Promsvyazbank Public Joint Stock Company (PSB), as well as 42 of their subsidiaries.
OFAC also levied sanctions on five high-ranking officials in President Vladimir Putin’s government.
“Our actions, taken in coordination with partners and allies, will degrade Russia’s ability to project power and threaten the peace and stability of Europe,” Secretary of the Treasury Janet L. Yellen said when Thursday’s sanctions were announced.
“We are united in our efforts to hold Russia accountable for its further invasion of Ukraine while mitigating impacts to Americans and our partners. If necessary, we are prepared to impose further costs on Russia in response to its egregious actions.”
JVC will address the Russian sanctions at its first compliance briefing of 2022, scheduled for Friday from 11 a.m. to noon Eastern. (It is for JVC members only.)
Jewelers of America said: “We are concerned about the evolving crisis in Ukraine and we are evaluating the real-world impact of sanctions. We will be issuing guidance to members in the coming days.”
In light of the sanctions released earlier in the week, both JVC and JA are urging U.S. jewelry businesses to determine if any of their suppliers or customers are using bank accounts connected to the sanctioned financial entities and, if so, to stop doing business with those accounts.
The full list of entities and individuals sanctioned Thursday can be found here and those sanctioned earlier in the week can be found here.
OFAC’s updated Specially Designated Nationals list is also available to search.
Anyone with questions or a need to obtain authorization to wind down transactions under a general license should contact the OFAC hotline at 1-800-540-6322.
Editors' Picks
Sponsored by
More on Policies & Issues
The Latest
CollectionsFeb 02, 2023
Lowe’s Is Now Selling JewelryThe home improvement store’s website features an “Empowerment Tools” demi-fine jewelry collection.
Events & AwardsFeb 02, 2023
Registration is Now Open for JIS Spring 2023The show will feature a new pavilion of 30 jewelry designers and manufacturers from Surat, India.
TrendsFeb 02, 2023
Amanda’s Style File: Purple and Playful Amanda Gizzi welcomes February with a selection of amethyst jewelry, a birthstone that “deserves its own time to shine.”
Brought to you by
Bringing Over 130 Years of Diamond Expertise to Modern GradingDe Beers Institute of Diamonds provides the very best in diamond verification, education and diamond services.
EditorsFeb 01, 2023
Designers to Watch in 2023: BoochierBehind the playful and nostalgic brand lies deeper meaning.
Weekly QuizFeb 02, 2023
This Week’s QuizTest your jewelry news knowledge with this short test.
Events & AwardsFeb 01, 2023
New Miami Jewelry Center Slated to Open in Q1The Time Century Jewelry Center is located in downtown Miami’s jewelry district.
SurveysFeb 01, 2023
Consumer Confidence Falls in JanuaryWariness about the year ahead offset a more positive view of the current economic situation.
Brought to you by
De Beers Institute of Diamonds Expands to Offer Education De Beers is sharing over 130 years of experience and expertise through the De Beers Institute of Diamonds with a selection of courses.
MajorsFeb 01, 2023
Six New Retailers Appointed to IJO’s Board of DirectorsThe IJO also welcomed one new vendor member to its 13-member board, Brecken Farnsworth of Parlé Jewelry Designs.
ColumnistsJan 31, 2023
Squirrel Spotting: How About a Word for the New Year?It begins with a “t” and ends with a “c” and is imbued with warmth and positivity, Peter Smith writes.
MajorsJan 31, 2023
Indian Jewelry Brand Tanishq Opens First U.S. Store, More on the WayThe jeweler’s expansion plans include 20 to 30 more stores in North America and the Middle East over the next two to three years.
Events & AwardsJan 31, 2023
Gucci Is Getting a Gem AwardThe Italian luxury brand will receive the first Gem Award for High Jewelry Excellence.
MajorsJan 31, 2023
Martin Flyer Names New VP of Business DevelopmentIndustry veteran Kevin Lane has stepped into the role.
MajorsJan 30, 2023
Researchers Uncover Bejeweled ‘Golden Boy’ MummyThe ancient Egyptian teenager was buried 2,300 years ago with 49 amulets to guide him through the afterlife.
SurveysJan 30, 2023
Consumers Embracing Non-Traditional Ways to Mark Valentine’s Day The NRF’s annual survey shows that consumer attitudes about how, or even whether, to celebrate Feb. 14 continue to evolve.
Events & AwardsJan 30, 2023
JA Is Searching for the Next Retail ’20 Under 40’ Nominations are open now through March 24.
MajorsJan 30, 2023
10 Jewelry News Stories You Might Have MissedA column detailing how independent jewelers did last year and the top watch brands of 2022 were among the most-read stories last week.
FinancialsJan 27, 2023
Tiffany & Co. Shines for LVMH in 2022Acquired in 2021, the brand’s high jewelry sales have doubled and its new “Lock” collection was an instant hit.
MajorsJan 27, 2023
Diamond Council of America Appoints Treasurer, Board MemberExecutives from Fred Meyer Jewelers and Riddles Jewelers have filled the roles.
CollectionsJan 27, 2023
Piece of the Week: Heavenly Vices’ Lock NecklaceThe Victorian-inspired design is a functional lock and key.
Supplier BulletinJan 26, 2023
JA New York Spring Brings the Industry TogetherFor over 100 years, JA New York has played an integral role in facilitating the evolution of our industry, while also honoring past traditions.
TrendsJan 26, 2023
At Vicenzaoro, Paola De Luca Gazes Into Jewelry’s FutureThe trend forecaster and her guests explored unconventional jewelry designs, NFTs, AI art, and more during her Trendvision presentation.
CollectionsJan 26, 2023
NDC and Lorraine Schwartz Announce New ‘EDDI’ ClassThe Emerging Designers Diamond Initiative provides diamond credit and mentorship to young brands helmed by BIPOC designers.
IndependentsJan 26, 2023
Lee Michaels Fine Jewelry Set to Open 10th StoreIt will be located in San Antonio’s Alamo Quarry Market and will be Lee Michaels’ third location in the city.
Policies & IssuesJan 26, 2023
Diamonds Do Good Names 10 to Board of DirectorsStephanie Gottlieb, Jewelers Mutual’s Mike Alexander, and Craig Rottenberg of Long’s Jewelers are among the new board members.
WatchesJan 25, 2023
These Were 2022’s Top-Selling Watch Brands, Chrono24 SaysRolex remained No. 1 while a brand known for its pilot watches slipped into the No. 5 spot.
MajorsJan 25, 2023
John Hardy Names New CEOLuxury retail executive Frédéric Levy has taken on the role.
