New York--It’s an issue that has been a topic of discussion in the industry for years but seems to have reached a boiling-over point, heated by the string of lawsuits filed against a Tennessee jeweler over EGL International reports and, more recently, a decision by Rapaport. 

RapNet, the diamond trading network operated by Rapaport Group, announced last week that effective Oct. 1, diamonds with grading reports from all European Gemological Laboratories, including EGL USA, will no longer be listed on RapNet. 

The move resulted in reactions from a couple of labs with the initials EGL. 

While a number of labs share the acronym EGL, they actually are not all the same, a fact which the Rapaport Group acknowledged in making its decision, stating, “While some EGL grading reports are more consistent with GIA grading standards than others, there is, in our opinion, confusion and inconsistency among the various EGL grading reports; RapNet has therefore decided not to list any EGL grading reports on RapNet.”

EGL International, the lab most commonly accused of over-grading, is headquartered in Israel. Managing Partner and CEO Guy D. Benhamou said in a statement issued Thursday that there is no international “standard” for diamond grading and that all grading is subjective, a statement the lab has made previously. 

“In general, gemological laboratories that issue diamond grading reports will consistently state that the results of diamond grading are, to a certain extent subjective,” Benhamou said. 

The statement did not directly address trade allegations of over-grading but went on to state that “EGL International’s laboratory staff is composed of graduate gemologists with international recognition. They work with state-of-the-art technology, enabling them to detect and disclose synthetic (laboratory-grown) diamonds, as well as a variety of advanced treatments to enhance color or clarity (e.g., HPHT).” 

EGL USA has its headquarters in New York, a lab in Los Angeles and affiliate labs in Toronto and Vancouver, British Columbia. 

In a statement issued Tuesday, EGL USA pointed out that it is “in no way affiliated” with any EGL-named laboratories outside of North America, and in 2003 sued the EGL labs outside of North America for trademark infringement and false advertising. That case is still pending. 

EGL USA said it was not accurate of Rapaport to associate it with allegations of over-grading and misrepresentation of diamond quality. 

“Simply put, the delisting of EGL USA penalizes us for our name alone. And while that is a great disservice to EGL USA, it is an even greater disservice to our customers and the industry-at-large,” EGL USA said, adding that it would announce updated trading platform plans “shortly.” 

Alan Lowe, managing director of EGL South Africa, said his lab, which is based in Johannesburg and has an office in Cape Town as well, shouldn’t be “grouped with some of the other EGL laboratories around the world when it comes to ethics or grading policy.” 

“The company operates independently from any other EGL laboratory globally and grades diamonds according to acceptable international grading standards,” he said. 

RapNet’s decision to stop listing all EGL-graded diamonds also sparked reactions from competing trading platforms. 

Polygon announced that effective Wednesday morning, it no longer would list diamonds from any EGL International lab but would continue carrying those diamonds with reports from EGL USA.

Polygon’s Senior Director of Sales and Operations Lindsay Watkin said the decision to swiftly stop listing EGL International-graded diamonds came in reaction to concerns in the trade about discrepancies between EGL International-graded diamonds and those graded by the Gemological Institute of America. “Our job is to support and reflect what’s going on in the industry,” she said, adding that reaction from customers has been overwhelmingly positive. 

GemFind and IDEX, however, said they will continue to list all EGL stones, including EGL International. 

A story posted Monday by IDEX Online stated that as long as there is no legal restriction, the diamond trading platform will continue to list all EGL-certified diamonds. (The homepage of NationalJeweler.com contains an IDEX Onsite, a separate domain featuring diamonds from the IDEX Online database.)

Newport Beach, Calif.-based GemFind said, “GemFind has chosen to remain unbiased and allow all companies to compete within the GemFind network and leave the decision of what to buy--or sell-- up to the jewelry retailers and diamond suppliers.” 

Editor's note: This article was updated to reflect the fact that the IDEX Online link on National Jeweler's homepage is an IDEX Onsite. The IDEX diamond trading platform is on www.idexonline.com. 


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