DCA Ethical Sourcing & Trade Regulations 2 — Questions and Answers
Question 1: Which international agreement, adopted in 2003, established the Kimberley Process Certification Scheme as a formal trade requirement?
- The Geneva Convention on Diamond Trade
- The UN General Assembly Resolution 55/56 and subsequent KPCS core document (Correct answer)
- The Doha Trade Facilitation Agreement
- The Basel Convention on Hazardous Materials
Correct answer: The UN General Assembly Resolution 55/56 and subsequent KPCS core document
UN General Assembly Resolution 55/56 on 'The Role of Diamonds in Fuelling Conflict' led directly to the establishment of the KPCS core document in 2003.
Question 2: Under the Kimberley Process, which entity is responsible for issuing Kimberley Process Certificates in the United States?
- The Federal Trade Commission
- The U.S. Geological Survey
- The U.S. Census Bureau on behalf of the Department of Commerce (Correct answer)
- The State Department Bureau of Economic Affairs
Correct answer: The U.S. Census Bureau on behalf of the Department of Commerce
In the United States, the U.S. Census Bureau, acting under the Department of Commerce, administers the issuance of Kimberley Process Certificates.
Question 3: A diamond trader receives a shipment with a Kimberley Process Certificate that lists a country not recognized as a KPCS participant. What is the correct action?
- Accept the shipment if the diamonds appear conflict-free
- Refuse the shipment and report the discrepancy to the relevant authority (Correct answer)
- Return only the certificate and keep the diamonds
- Request a replacement certificate from the supplier
Correct answer: Refuse the shipment and report the discrepancy to the relevant authority
Shipments from non-participant countries cannot be legally imported under KPCS, and suspicious certificates should be reported to the relevant authority.
Question 4: Which U.S. federal law incorporates the Kimberley Process requirements and restricts the import of conflict diamonds?
- The Clean Diamond Trade Act of 2003 (Correct answer)
- The Foreign Corrupt Practices Act
- The Dodd-Frank Wall Street Reform Act Section 1502
- The Export Administration Regulations
Correct answer: The Clean Diamond Trade Act of 2003
The Clean Diamond Trade Act of 2003 implements U.S. obligations under the Kimberley Process Certification Scheme and prohibits the importation of conflict diamonds.
Question 5: The Responsible Jewellery Council (RJC) Code of Practices requires member companies to conduct due diligence on which aspect of diamond sourcing?
- Diamond color grading consistency only
- Human rights, labor rights, environmental impact, and business ethics throughout the supply chain (Correct answer)
- Retail pricing compliance with MSRP guidelines
- Marketing claim accuracy for diamond enhancements
Correct answer: Human rights, labor rights, environmental impact, and business ethics throughout the supply chain
The RJC Code of Practices requires members to address human rights, labor rights, environmental impact, and ethical business conduct across their entire supply chain.
Question 6: Which term describes diamonds mined in a war zone and sold to finance an armed group's opposition against a legitimate government?
- Smuggled diamonds
- Conflict diamonds (blood diamonds) (Correct answer)
- Synthetic diamonds
- Melee diamonds
Correct answer: Conflict diamonds (blood diamonds)
Conflict diamonds, also called blood diamonds, are defined as rough diamonds used by rebel movements to finance wars against legitimate governments.
Question 7: Under KPCS rules, what must accompany every shipment of rough diamonds crossing an international border?
- A GIA grading report for each stone
- A tamper-resistant container with a government-issued Kimberley Process Certificate (Correct answer)
- A private sector warranty from the exporting company
- An CIBJO member authentication stamp
Correct answer: A tamper-resistant container with a government-issued Kimberley Process Certificate
KPCS requires rough diamonds to be shipped in tamper-resistant containers accompanied by a government-validated Kimberley Process Certificate.
DCA Ethical Sourcing & Trade Regulations 2
Which international agreement, adopted in 2003, established the Kimberley Process Certification Scheme as a formal trade requirement?