On February 8, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced the imposition of sanctions against additional categories of Russian diamonds in accordance with the decision of the Group of Seven countries
Ban on imports of diamonds mined in Russia, and processed in third countries
OFAC has issued a decision to ban the import of non-core diamonds mined in Russia, regardless of whether they were processed in a third country.
Starting on March 1, the US will initially apply the decision to certain categories of diamonds and then expand it to include additional categories on September 1.
In its second decision, the U.S. Treasury Department bans imports of diamond jewelry and rough diamonds originating in or imported from Russia effective March 1, 2024.
“These prohibitions are intended to implement the December 2023 G7 commitments to impose phased restrictions on the importation of diamonds mined or extracted in Russia. OFAC intends to issue additional public guidance regarding these determinations”.OFAC’s statement
In December 2023, US President Joe Biden introduced the first restrictions on Russian diamonds through a decree.
EU’s ban on Russian diamonds
As part of the EU’s 12th package of sanctions against Russia, the restriction on trade in diamonds originating from the Russian Federation took effect on Monday, January 1.
A ban on the direct or indirect import, purchase, or transfer of diamonds from Russia is among the measures has been enacted.
From March 1 to September 1, 2024, the EU will implement restrictions on Russian diamonds processed in third countries.
G7’s decision to ban Russian diamonds
The Group of Seven countries announced their intention to impose restrictions on Russian-made diamonds following a virtual summit on December 6.
By September 1, 2024, the Group of Seven countries, which are the main importers of rough diamonds, will create a mechanism for verification and certification of rough diamonds and will consult with producing countries and partners on this issue, the leaders added.
On January 3, the EU Council added Russian diamond mining giant Alrosa and its CEO Pavel Marinichev to the sanctions list.
Alrosa is the largest diamond mining company in the world, owned by the Russian state and accounting for more than 90% of all Russian diamond production.
Russian diamond production
Russia is the world’s largest diamond producer. Trade in precious stones is an important industry and a significant source of income for the Russian Federation.
The export of diamonds and polished diamonds brings the Kremlin 4 billion euros a year, according to estimates.
Sanctions and embargoes imposed by the West are intended to deplete Vladimir Putin’s war chest finally.
According to US Treasury Department in Washington, Alrosa allegedly assisted Putin in financing his war. The Yakutia region and the Russian state control 66% of the group. Its owner was among the first oligarchs to receive US sanctions because the US views him as a close ally of Putin.