India’s Gem & Jewellery trade adopts terminologies under FTC Guidelines USA for Diamonds and Laboratory-Grown Diamonds

November 29, 2024: The Gem & Jewellery Export Promotion Council (GJEPC), apex body for the gem & jewellery trade in India, has adopted the new mandated definition, nomenclature and guidelines for diamonds specified by the Federal Trade Commission (FTC) of the United States (U.S.). The FTC’s updated guidelines provide a clear, standardised definition of ‘diamond’ and distinct terminology for laboratory-grown diamonds, ensuring clarity and transparency for both industry stakeholders and consumers.

GJEPC’s members will ensure compliance with the new definition of ‘diamond’ and request all other gem and jewellery trade bodies and retailers to do the same. Additionally, GJEPC is leading the consultation with the Govt. and made representation to the Consumer Affairs Ministry to align this new definition with the country’s consumer laws. This alignment will empower consumers to make informed decisions, eliminate confusion, and prevent any misleading implications regarding the authenticity of diamonds. Following GJEPC’s representation to the Govt., the Central Consumer Protection Authority (CCPA) has proactively organised a stakeholder consultation on Consumer Protection for the diamond sector. CCPA has also formed a working group to review on the diamond terminology for framing the Indian Standard on similar lines with the aim to protect and prosper both Natural and LGD Industry.

Mr. Vipul Shah, Chairman, GJEPC, said, “Since India’s gem & jewellery trade has unanimously accepted the FTC’s new definition with respect to diamonds, we urge the Indian Government and Ministries to accept, adopt and adapt the same to existing consumer laws of our country. This initiative is in consumer interest and protects their rights while shielding them from misinformation. The FTC’s new definition reflects technological advancements and ensures clarity in diamond marketing, applying the same standards to both mined and lab-grown diamonds.”

“GJEPC will commence the process of educating the Indian trade to ensure a level-playing field and compliance. This will ensure that all key stakeholders of the trade value chain are responsible and empowered to guide, counsel and advise consumers and consumer bodies to enhance consumer confidence. This will open a new chapter in India’s glorious gem & jewellery exports to the world and infuse confidence in the minds of global buyers and export destinations,” added Mr. Shah.

GJEPC is leading the consultation with the Government because in the present scenario, consumer understanding is that ‘diamond’ without a prefix implies natural, but the existing Consumer Protection Act law does not specifically state this. GJEPC has urged the Government to align the new definition to the existing Consumer Protection Act to offer protection against defects, deficiencies, and unfair trade practices.

Terms such as real, genuine, natural, and precious cannot describe lab-grown diamonds (LGD). The term “cultured” can be used for lab-grown diamonds and must be immediately followed by terms such as laboratory-created, laboratory-grown. Marketers can use laboratory-grown, laboratory-created, and clear terms to describe lab-grown diamonds. Sellers must nonetheless comply and are therefore responsible for ensuring they do not make deceptive claims. Even Indian LGD trade (like its global counterparts) has accepted the new definition and will comply with the same.

Smit Patel, Convener, Lab-grown Diamond Panel, GJEPC, said, “We have urged the Government to align with the advancements and economic significance of lab-grown diamonds by adopting a forward-looking policy framework. Globally, these diamonds are recognised as ‘laboratory-created’ or ‘laboratory-grown,’ not ‘synthetic diamonds,’ and India should embrace this terminology. The lab-grown diamond industry has also contributed to the creation of millions of jobs domestically and is driving substantial exports, reinforcing India’s position as a global leader in this rapidly growing sector.”

In terms of ‘Jewelry Guides’, FTC guidelines for marketing and advertising gems and jewellery ensure clarity and prevent misleading terms in the industry. In terms of enforcement: Non-compliance can lead to lawsuits and civil penalties in the U.S. They were first published in 2016, further amended in 2018. And they have been universally adopted in India’s key export markets of the world.

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