Blood Diamonds and conflict: An analysis of legal frameworks preventing illicit diamond trade
Author : Alisha Varandani
Blood diamonds can be described in the simplest terms as rough diamonds sold to finance conflict, including civil wars and violent insurgency. International studies on how these conflicts are funded and sustained over several years term conflict diamonds or blood diamonds as 'rough diamonds used by rebel movements or their allies to finance conflict aimed at undermining legitimate governments'.
There exists a strong correlation between conflicts and trade in natural resources, particularly in African nations. Thus, countries like Angola, the Democratic Republic of Congo and Sierra Leone- which have easily accessible resources, especially alluvial diamonds (diamonds that are deposited in alluvial regions like riverbeds as a result of natural erosion and can be mined using basic tools) and high levels of ethnic fractionalization, are susceptible to conflict.
The major international legal framework preventing the illegal trade of diamonds is the Kimberley Process Certification Scheme (KPCS), which has been in effect since 2003. It is a regulatory agreement that involves three parties- the member states (called "participants"; there are currently 56 participants representing 82 countries, with the European Union and its Member States counted as a single member), the diamond industry (represented by the World Diamond Council) and overseeing NGOs (called "observers"). Further, membership requirements require laws to be passed in the country that incorporate the KP Core Document's principles. The major provisions in the agreement include-
A. each shipment of diamonds crossing an international border should be transported in a tamper-resistant container and be accompanied by a government validated Kimberley Certificate;
B. each certificate must be uniquely numbered, forgery resistant, and provide details on the shipment contents, including the number of carats, the value in US dollars, identification of the importer and exporter, etc.
C. failure to comply with these minimum criteria may cause suspension or removal of a noncomplying Country. (Kimberley Process, 2015).
However, legal provisions for diamond mining are still riddled with loopholes. One such loophole is the lack of any definitive framework on diamonds smuggled across borders. Take, for instance, Venezuela. Although Venezuela has high levels of diamond production, it lists no official exports since 2005. However, the application of neighbouring Panama (a non-diamond producing country) to the Kimberley Process suggests smuggled gems inside its borders. Further, to circumvent legally-required certification processes, rebel groups in countries like Côte d'Ivoire sell rough diamonds on the international market through external channels in countries like Mali.
Another loophole lies in the very definition of "conflict diamonds" as rough stones. Diamonds are often sold after receiving a minimal number of alterations and are thus categorized as "manufactured goods" and fall outside the purview of existing legal frameworks. A notable instance of this can be found in a 2013 report published by a UN Panel of Exports. It mentions the possibility of a manufacturing facility in Côte d'Ivoire, producing partially polished stones that could be directly traded in the market.
Section I of the Kimberley Process Core Document also allows for parcels of mixed origin to be sold together. This, in layman's terms, means that rough diamonds from two or more countries of origin can be bundled together and considered a single parcel in the certification process; the certificate issued will state the name of the place where the diamonds were mixed, and not where they were mined. This technicality has been exploited by companies like Omega Diamonds, a Belgian company that has been known to purchase diamonds of questionable origin for a small price tag in Angola, the Democratic Republic of Congo, and Zimbabwe. As per several lawsuits filed against the company, these diamonds would then be shipped to Dubai where they would be given a certificate of mixed origin and subsequently sold for profit.
All existing legal frameworks on the issues have scope for improvement in some common areas. Firstly, while participation in the treaties and agreements- particularly the KPCS- is encouraged by the global community, particularly the UN, it is voluntary. A tougher push for participation and compliance could go a long way in preventing illicit trade of diamonds.
Secondly, independent monitoring systems must be developed to ensure compliance of member states to the agreed upon rules and regulations. Further, there is a need for uniform enforcement as well as punishment standards. The punishment meted to a blood diamond trader ranges from severe capital punishment to mere fines in some areas.
Another critique is that all agreements and laws have failed to ensure effective government control over diamond mines. For instance, Zimbabwe's infamous Marange mining camps, apart from having atrocious living conditions for miners, also help fuel conflict in the region through the illegal sale of diamonds mined. Transferring control to the government, thus, will help boost accountability as well as reduce chances of illicit trade occurring.
Certificate forgery is another issue, so much so that the KPCS committee in 2012 had to publicly announce that all certificates coming out of Cameron, a non-participant state, were forgeries and thus not valid. Better coordination between the Member States, stricter compliance measures, and regular follow-up procedures could resolve these issues.
Thus, while the Kimberley Process remains the first-ever internationally driven tool aimed at breaking the links between minerals and conflicts, international law and its provisions still fall short when dealing with conflict diamonds, leaving much room for improvement.