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Vaaldiam's Commitment to the Kimberley Process Certification Scheme
Vaaldiam Mining Inc. complies with the Kimberley Process Certification Scheme (‘KPCS’).
What is the KPCS?
In December 2000, the General Assembly of the United
Nations unanimously passed a resolution calling for the
establishment of a procedure which would certify that rough
diamonds traded internationally had not been sold in order
to finance armed conflict. Rough diamonds sold to finance
armed conflict became known as ‘conflict diamonds’ or ‘blood
diamonds’. The KPCS, implemented in January 2003, was the
international response to the United Nations resolution.
The KPCS is designed to provide assurance to the
ultimate purchaser of a diamond, as well as those
intermediaries such as diamond cutters, diamond dealers and
selling organizations, that by purchasing a particular
diamond they have in no manner contributed to armed conflict
in the diamond's country of origin or anywhere else. The
KPCS is therefore meant to provide a chain of assurance
stretching from the miner of a particular rough diamond to
the ultimate purchaser of a faceted stone.
The KPCS
requires a Kimberley Process Certificate (the ‘Certificate’)
to be prepared and which must accompany each export shipment
of rough diamonds. Each Certificate must state the country
of origin of the diamonds being shipped, the issuing
authority for the Certificate, the date of issue of the
Certificate, the identification of the exporter and the
importer, the number of carats in the parcel and the value
of the diamonds. All diamonds shipped in accordance with the
KPCS must be in tamper and forgery resistant containers.
Validation of the Certificate by the authorized Exporting
Authority (the ‘Exporting Authority’) is required. No
participant country can export to, or receive diamonds from,
a non-participant country. The KPCS, therefore, seeks to
create a closed system for legitimate diamond trading, from
which conflict diamonds are excluded.
Who participates in the KPCS?
Some 47 countries, have agreed to participate in the
KPCS, including Canada, Brazil, the European Union, the
Central African Republic, the United States, Botswana and
South Africa. Each participant in the KPCS has undertaken
to establish a system of internal controls designed to
eliminate the presence of conflict diamonds, to designate an
Importing and Exporting Authority, to amend or enact
appropriate laws or regulations to implement and enforce the
KPCS, to maintain dissuasive and proportional penalties for
transgressions and to maintain and exchange a database with
other participants.
Participants are encouraged to
ensure that all diamond mines are licensed and to allow only
those mines so licensed to mine diamonds. In addition,
participants are encouraged to require prospecting and
mining companies to maintain effective security standards to
ensure that conflict diamonds do not contaminate legitimate
production. The KPCS recommends that all diamond buyers,
sellers, exporters, agents and courier companies involved in
carrying or handling rough diamonds, be registered by each
participant's relevant authorities.
How are Diamonds Imported and Exported under the KPCS?
Regarding the export process, the KPCS recommends that an
exporter should submit a rough diamond shipment to the
relevant Exporting Authority which will require the exporter
to provide a declaration that the rough diamonds being
exported are not conflict diamonds. The Exporting Authority
is expected to have sufficient expertise and knowledge of
the exporter's operations to evaluate the correctness of the
exporter's declaration.
Rough diamonds for export
should be sealed in a tamper resistant container together
with the Kimberley Process Certificate or a duly
authenticated copy. The Exporting Authority should then
transmit a detailed e-mail message to the relevant Importing
Authority containing information on carat weight, value,
country of origin, importer and the serial number of the
Certificate. The Importing Authority should receive the
e-mail message from the Exporting Authority either before or
upon arrival of a rough diamond shipment. The Importing
Authority should open and inspect the shipment to verify
that the seals and the container have not been tampered with
and that the export was performed in conformity with the
Certification Scheme. The Importing Authority should then
send the return slip or import confirmation coupon to the
relevant Exporting Authority. All participants are
recommended to maintain a statistical database of diamond
imports and exports which data are to be made available for
analysis by the participants and other interested parties.
Brazil and the KPCS
In the case of the export of diamonds from Brazil, the
Brazil Kimberley Process Certificate or Certificado do
Processo de Kimberley is issued by the Departamento Nacional
de Produção Mineral (DNPM) which is a department of the
Ministério de Minas e Energia. The Brazil Certificate
certifies that the unpolished diamonds in the consignment
have been handled in accordance with the provisions of the
KPCS for rough diamonds. The Certificate describes the
number of carats in the shipment, their value, the country
of origin, the purpose of the shipment, the importer and
exporter, the number and date of issue and expiry of the
Certificate. Finally, the Certificate is signed by both the
Director-General of the DNPM and the Head of the DNPM in the
district from where the diamonds were mined.
In the
case of a shipment of diamonds from Brazil to Canada the
Brazil Kimberley Process Certificate is stamped on arrival
in Canada by the Canada Border Services Agency and the
appropriate Excise and Goods and Services Taxes are paid by
the importer.
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