EditorsFeb 15, 2023
4 Predictions for the Diamond Market in 2023 and BeyondPolicies & IssuesFeb 28, 2023
Tighter Sanctions on Russian Diamonds Are Likely Coming, JVC Warns
New regulations could block the pathway that allows diamonds cut and polished outside of Russia to enter the United States.
On Feb. 24, the one-year anniversary of Russia’s invasion of Ukraine, leaders of the G7 nations announced their ongoing support for Ukraine and their intentions to make it more difficult for Russia to continue to fund the war. Limiting Russia’s ability to profit from its diamonds is one of the areas G7 leaders likely will address.
New York—Leaders of the Group of Seven recently announced they will be working together to tighten restrictions on diamonds coming out of Russia, both rough and polished.
The Group of Seven, or G7, is an informal, intergovernmental group comprised of seven industrialized democracies: the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom.
In a statement issued Friday—the one-year anniversary of Russia’s invasion of Ukraine—G7 leaders called on Russia to put a stop to the war in Ukraine, which has killed thousands of Ukrainians, forced millions more to flee, and led to the destructions of homes, hospitals, schools, critical infrastructure, and historic cities across the country.
“We condemn Russia’s illegal, unjustifiable, and unprovoked war, disregard for the Charter of the United Nations and indifference to the impacts that its war is having on people worldwide,” they said.
“We salute the heroism of the Ukrainian people in their brave resistance. We commit to intensifying our diplomatic, financial, and military support for Ukraine, to increasing the costs to Russia and those supporting its war effort, and to continuing to counter the negative impacts of the war on the rest of the world, particularly on the most vulnerable people.”
In the statement, diamonds are mentioned specifically as a product Russia is using to help fund the war, and one of the revenue streams G7 nations are looking to restrict.
“Given the significant revenues that Russia extracts from the export of diamonds, we will work collectively on further measures on Russian diamonds, including rough and polished ones, working closely to engage key partners,” they said.
Related stories will be right here …
The Group of Seven, or G7, is an informal, intergovernmental group comprised of seven industrialized democracies: the United States, Canada, France, Germany, Italy, Japan, and the United Kingdom.
In a statement issued Friday—the one-year anniversary of Russia’s invasion of Ukraine—G7 leaders called on Russia to put a stop to the war in Ukraine, which has killed thousands of Ukrainians, forced millions more to flee, and led to the destructions of homes, hospitals, schools, critical infrastructure, and historic cities across the country.
“We condemn Russia’s illegal, unjustifiable, and unprovoked war, disregard for the Charter of the United Nations and indifference to the impacts that its war is having on people worldwide,” they said.
“We salute the heroism of the Ukrainian people in their brave resistance. We commit to intensifying our diplomatic, financial, and military support for Ukraine, to increasing the costs to Russia and those supporting its war effort, and to continuing to counter the negative impacts of the war on the rest of the world, particularly on the most vulnerable people.”
In the statement, diamonds are mentioned specifically as a product Russia is using to help fund the war, and one of the revenue streams G7 nations are looking to restrict.
“Given the significant revenues that Russia extracts from the export of diamonds, we will work collectively on further measures on Russian diamonds, including rough and polished ones, working closely to engage key partners,” they said.
In a member alert circulated Monday, the Jewelers Vigilance Committee said the forthcoming sanctions are likely to address the issue of “substantial transformation,” which allows diamonds from Russia to enter the U.S. if they are cut and polished in another country—which many of them are—despite President Joe Biden’s March 2022 executive order banning their import.
The substantial transformation pathway dates to a 1940 Court of Customs and Patent Appeals ruling in United States v. Gibson-Thomsen Co. Inc., a case about toothbrushes and hairbrushes that had their handles/bases made in Japan but their bristles added in the U.S.
According to the ruling, a product undergoes a substantial transformation if via further manufacturing, it becomes a new product with “a new name, character and use.” The product is then considered to originate from the country where the transformative manufacturing took place.
In 2019, U.S. Customs and Border Patrol (CPB) extended the concept of substantial transformation to the cutting and polishing of diamonds.
“This is not going to be an immediate [change] but this is an indication the U.S. government is working on this issue … it is a priority.” — Sara Yood, Jewelers Vigilance Committee
The diamonds in question in that case were mined in Botswana, evaluated in the U.S., sawn and blocked in China, and cut and polished in India. CBP ruled the cutting and polishing was the substantial transformation in the process—the significant step that ultimately changed the character of the rough diamonds—and so the diamonds’ country of origin was India.
JVC Deputy General Counsel Sara Yood said the intent behind the G7 statement is to tighten up the substantial transformation pathway for these goods without damaging substantial transformation, a useful interpretation of the law that’s used across industries, as a concept.
It also will help clear up confusion in the U.S., the world’s largest market for diamonds, where tight sanctions on Russian diamonds have been in place for almost a year.
“The U.S. market has been looking for clarity on this issue for 10 months. On the government level, they’ve also been trying to give us clarity for 10 months,” Yood said.
Editors' Picks
Sponsored by
The process of creating and implementing any new regulations is expected to take a few months.
The European Union is a non-enumerated member of the G7 and one of its member countries, Belgium—home to the diamond trading hub of Antwerp—has been resistant to restricting the flow of Russian diamonds, thereby potentially complicating negotiations.
Yood said in the U.S., there also will be a phase-in period for any new regulations.
“This is not going to be an immediate [change] but this is an indication the U.S. government is working on this issue and the G7 is working on this issue, and that it’s a priority,” she said.
In the meantime, JVC recommends suppliers abroad that are still purchasing diamonds from Alrosa begin segregating those goods so they don’t reach the U.S. market.
It also recommends companies “be prepared” to make customs declarations that their diamonds aren’t from Russia, though it is not immediately clear how U.S. Customs will approach country of origin declarations for diamonds.
In addition, JVC urges U.S. businesses to evaluate their supply chains. They need to know where their products originate and, if they need to adjust sourcing, how it can be done.
Yood said utilizing existing anti-money laundering (AML) and know your customer (KYC) protocol is a great framework to start with, as is referencing the OECD due diligence guidance created for sourcing metals from high risk and conflict-affected areas.
JVC CEO and General Counsel Tiffany Stevens said the organization will work with the U.S. State Department and other government partners to ensure the industry fully understands its responsibilities regarding any new regulations.
“In the meantime, JVC will continue to educate the trade on its role in ensuring that U.S. dollars do not go to fund the ongoing unjustified war in Ukraine,” she said.
Sanction developments, including the latest news from the G7 nations, will be the topic of discussion at the JVC’s upcoming annual luncheon, scheduled for Friday, March 17, at the InterContinental Barclay hotel in New York.
Ambassador James O’Brien will be the keynote speaker at the event.
O’Brien has served as the Biden administration’s head of Office Sanctions Coordination since April 2022 and prior to that, served as the special envoy for hostage affairs under President Barack Obama.
He can speak to any and all developments regarding sanctions on Russian diamonds.
For more information on the luncheon, visit the JVC website.
More on Policies & Issues
The Latest
AuctionsAug 29, 2025
Sotheby’s UAE Sale to Feature 32-Carat Fancy Vivid Orangy Pink DiamondThe highlight of a single-owner jewelry and watch collection, it’s estimated to fetch up to $7 million at auction this December.
FinancialsAug 29, 2025
Movado’s Q2 Sales Rebound Despite Tariff ImpactCEO Efraim Grinberg noted a resurgence in the fashion watch market.
CollectionsAug 29, 2025
Piece of the Week: Mark Davis’ ‘Bullseye’ Necklace The “Bullseye” necklace, with vintage bakelite and peridot, August’s birthstone, is the perfect transitional piece as summer turns to fall.
Brought to you by
Rallying Call for the Jewelry Industry on Tariffs and Other Key IssuesJewelers of America is leading the charge to protect the industry amidst rising economic threats.
Supplier BulletinAug 28, 2025
Clientbook Is Helping Jewelers Turn Clienteling Challenges into Wins with Hands-On Training and CoachingSponsored by Clientbook
Weekly QuizAug 29, 2025
This Week’s QuizTest your jewelry news knowledge by answering these questions.
GradingAug 28, 2025
GIA’s New ‘Quality Assessment’ for Lab-Grown Diamonds Is Coming It will classify lab-grown stones into one of two categories, “premium” or “standard,” in lieu of giving specific color and clarity grades.
SourcingAug 28, 2025
Botswana Declares Public Health Emergency Amid Diamond Sales SlumpPresident Duma Boko addressed the country’s medical supply chain crisis in a recent televised address.
Brought to you by
Taking the Moment Head On: How Rio Grande Champions the Present & Future of Fine JewelryAs a leading global jewelry supplier, Rio Grande is rapidly expanding and developing new solutions to meet the needs of jewelers worldwide.
MajorsAug 28, 2025
Borsheims Names New Jewelry BuyerFormer Free People buyer Afton Robertson-Kanne recently joined the retailer.
IndependentsAug 28, 2025
Sissy’s Log Cabin Donates School Supplies to Memphis StudentsThe jeweler teamed up with two local organizations for its inaugural “Back to School and Bling” event.
EditorsAug 27, 2025
Taylor Swift’s Engagement Ring Is a Fairy Tale for Vintage Diamond CutsThe singer’s new bling, reportedly a natural old mine-cut diamond, is no paper ring.
SourcingAug 27, 2025
11,685-Carat Emerald Recovered From Zambia’s Kagem MineDubbed the “Imboo,” or “buffalo,” emerald, the rough gemstone is part of Gemfields’ latest emerald auction, which is taking place now.
SurveysAug 27, 2025
Consumer Confidence Slips in August Amid Job, Income WorriesPlans for dining out, booking vacations, and buying big-ticket items were down.
CollectionsAug 27, 2025
Mined + Found’s New Collection Gets Playful The “Play” collection centers on nostalgic toys that have kinetic elements to carry playfulness and wonder into adulthood.
CollectionsAug 26, 2025
Does Your Jewelry Stack Need a Snack?Designer Christina Puchi, the creative force behind CCWW Designs, has created charms and pendants based on iconic candies and crackers.
WatchesAug 26, 2025
Nick Jonas Gets Nostalgic in New Fossil CampaignThe Jonas Brothers star showed off new timepieces against the backdrop of his favorite spots in his home state of New Jersey.
IndependentsAug 26, 2025
Hinkamp Jewelers Celebrates 70 YearsThe family-owned jeweler in Fayetteville, North Carolina, is in the hands of the second generation.
ColumnistsAug 26, 2025
Back to School, Back to Style: Why August is Prime Time for Self-GiftingIn his latest column, Emmanuel Raheb shares tips for encouraging customers to treat themselves to new jewelry.
WatchesAug 25, 2025
London Jewelers Brings Rolex to Historic Hamptons HomeThe new stand-alone Rolex boutique is housed in the former Odd Fellows Hall, a landmark built in 1897.
CollectionsAug 25, 2025
Tennis Star Madison Keys Has the Perfect Necklace for the US OpenThe Brilliant Earth ambassador co-designed a diamond medallion featuring meaningful symbols.
TrendsAug 25, 2025
Amanda’s Style File: That’s a WrapWrap jewelry is more than just a trend; it’s the perfect motif for the coming season of layering, scarves, and pumpkin spice.
WatchesAug 25, 2025
WatchTime NY Show Returns for 10th Anniversary EditionThe three-day watch collector show, coming this October, will feature 44 exhibiting brands, as well as a new dinner experience.
GradingAug 22, 2025
Former Head of GIA India Promoted to Oversee Global Operations Sriram “Ram” Natarajan is now GIA’s senior vice president of laboratory operations and is based out of the lab’s headquarters in Carlsbad.
CollectionsAug 22, 2025
Piece of the Week: Retrouvaí’s ‘Diamond Vein Bond’ CollarThe one-of-a-kind collar represents the beauty of imperfection and the strength to rebuild.
MajorsAug 22, 2025
Kendra Scott Returns as CEO of Her Jewelry EmpireThree C-suite executives, including former CEO Tom Nolan, have resigned as part of what the company describes as a “transition.”
MajorsAug 21, 2025
Claire’s Finds Buyer, Could Save up to 950 StoresThe retailer, which recently filed Chapter 11, inked a deal to sell its North American business and intellectual property.
MajorsAug 21, 2025
Target Names New CEO as Sales Continue to Lag Target CEO Brian Cornell will step down in February and be replaced by the company’s chief operating officer, Michael Fiddelke.
