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DPA Raises Concerns over Synthetics Marketing
Aug 6, 2018 5:40 AM
By Rapaport News
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RAPAPORT... The Diamond Producers Association (DPA) is worried lab-grown
diamond suppliers will use the new Federal Trade Commission (FTC) guidelines to
confuse consumers — a claim synthetics companies reject.
The FTC last month removed the word “natural” from its
definition of diamond, enabling growers to claim their stones
are 100% diamond. However, they still must disclose that they are not from the
earth.
“We understand the basis for this decision,” the DPA — an
alliance of leading miners — said in a statement last week. “But we are concerned
that it will be exploited by man-made diamond marketers, who may feel they can
use the term ‘diamond’ without properly qualifying it, leading to more consumer
confusion and deception.”
Yet the lab-grown sector has no intention of falling foul of
the FTC’s disclosure requirements, the International Grown Diamond Association
(IGDA) confirmed to Rapaport News.
“[Our members] will continue to proudly and openly label and
promote our products as lab-grown, cultured, etc., as defined by the FTC,” said
IGDA secretary general Richard Garard in an email Thursday. “There is no
question that IGDA and our members gladly promote that fact.”
Garard highlighted the FTC’s new stance on the term
“synthetic,” which no longer appears on the commission’s list of recommended
words for describing lab-grown stones. Competitors use the label to make
lab-grown diamonds sound like fakes, IGDA argued to the FTC during its review
process. The “real question” is whether natural-diamond promoters will comply
with the updated advice, “since they can no longer use disparaging terms about
grown diamonds,” Garard said.
“If they follow the guidelines and also stop using the term
synthetic, which is acknowledged by [the] FTC and the [Jewelers Vigilance Committee]
to confuse the consumer, the confusion [among] consumers will easily go away,” he
added.
However, the FTC only outlaws the word “synthetic”
completely when the user is trying to deceive consumers into thinking a lab-grown
stone is in fact a simulant such as cubic zirconia or moissanite, the DPA
noted.
The DPA also took issue with the FTC’s conclusion on the
phrase “cultured diamonds,” which it refused to ban because, it claimed, marketers
can successfully qualify the word to remove any confusion. The DPA had argued
to the FTC that the term was not appropriate for lab-grown diamonds because the
manufacturing process “begins and ends in a factory,” unlike with
cultured-pearl growth, which is a “symbiotic relationship between man and
nature.”
“The implications of this decision [are] likely to be more
consumer confusion and deception,” the DPA said last week. The suggestion that marketers can use a “factually incorrect” term so long as they clarify it through
additional language is a departure from previous FTC practice, the DPA added.
While the DPA “welcomes” the new guidelines and commits to
respecting them, the new rules “introduce the possibility of substantial
consumer deception and harm in several important respects,” the association
continued.
“Unless the FTC further clarifies these issues, the agency
will likely need to address a large number of claims on a cumbersome
case-by-case basis. DPA had hoped that the agency would provide clearer
guidelines for [the] industry on these important issues.”
Image: Lark & Berry
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Tags:
cubic zirconia, cultured, cultured diamonds, Diamond Producers Association, Dpa, federal trade commission, ftc, FTC guidelines, IGDA, International Grown Diamond Association, Jewelers Vigilance Committee, JVC, lab-grown diamonds, moissanite, pearl, Rapaport News, Richard Garard, Synthetic diamonds, Synthetics
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