[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2027 Introduced in Senate (IS)]







107th CONGRESS
  2d Session
                                S. 2027

To implement effective measures to stop trade in conflict diamonds, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 18, 2002

 Mr. Durbin (for himself, Mr. DeWine, and Mr. Feingold) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To implement effective measures to stop trade in conflict diamonds, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Clean Diamond Trade Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Funds derived from the sale of rough diamonds are being 
        used by rebels, state actors, and terrorists to finance 
        military activities, overthrow legitimate governments, subvert 
        international efforts to promote peace and stability, and 
        commit horrifying atrocities against unarmed civilians. During 
        the past decade, more than 6,500,000 people from Sierra Leone, 
        Angola, and the Democratic Republic of the Congo have been 
        driven from their homes by wars waged in large part for control 
        of diamond mining areas. A million of these are refugees eking 
        out a miserable existence in neighboring countries, and tens of 
        thousands have fled to the United States. Approximately 
        3,700,000 people have died during these wars.
            (2) The countries caught in this fighting are home to 
        nearly 70,000,000 people whose societies have been torn apart 
        not only by fighting but also by terrible human rights 
        violations.
            (3) Human rights advocates, the diamond trade as 
        represented by the World Diamond Council, and the United States 
        Government recently began working to block the trade in 
        conflict diamonds. Their efforts have helped to build a 
        consensus that action is urgently needed to end the trade in 
        conflict diamonds.
            (4) The United Nations Security Council has acted at 
        various times under chapter VII of the Charter of the United 
        Nations to address threats to international peace and security 
        posed by conflicts linked to diamonds. Through these actions, 
        it has prohibited all states from exporting weapons to certain 
        countries affected by such conflicts. It has further required 
        all states to prohibit the direct and indirect import of rough 
        diamonds from Angola and Sierra Leone unless the diamonds are 
        controlled under specified certificate of origin regimes and to 
        prohibit absolutely for a period of 12 months the direct and 
        indirect import of rough diamonds from Liberia.
            (5) In response, the United States implemented sanctions 
        restricting the importation of rough diamonds from Angola and 
        Sierra Leone to those diamonds accompanied by specified 
        certificates of origin and fully prohibiting the importation of 
        rough diamonds from Liberia. In order to put an end to the 
        emergency situation in international relations, to maintain 
        international peace and security, and to protect its essential 
        security interests, and pursuant to its obligations under the 
        United Nations Charter, the United States is now taking further 
        action against trade in conflict diamonds.
            (6) Without effective action to eliminate trade in conflict 
        diamonds, the trade in legitimate diamonds faces the threat of 
        a consumer backlash that could damage the economies of 
        countries not involved in the trade in conflict diamonds and 
        penalize members of the legitimate trade and the people they 
        employ. To prevent that, South Africa and more than 30 other 
        countries are involved in working, through the ``Kimberley 
        Process'', toward devising a solution to this problem. As the 
        consumer of a majority of the world's supply of diamonds, the 
        United States has an obligation to help sever the link between 
        diamonds and conflict and press for implementation of an 
        effective solution.
            (7) Articles XX and XXI of the General Agreement on Tariffs 
        and Trade 1994 allow members of the World Trade Organization to 
        take measures to deal with situations such as that presented by 
        the current trade in conflict diamonds without violating their 
        World Trade Organization obligations.
            (8) Failure to curtail the trade in conflict diamonds or to 
        differentiate between the trade in conflict diamonds and the 
        trade in legitimate diamonds could have a severe negative 
        impact on the legitimate diamond trade in countries such as 
        Botswana, Namibia, South Africa, and Tanzania.
            (9) Initiatives of the United States seek to resolve the 
        regional conflicts in sub-Saharan Africa which facilitate the 
        trade in conflict diamonds.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Conflict diamonds.--The term ``conflict diamonds'' 
        means--
                    (A) rough diamonds the importation of which is 
                prohibited by United Nations Security Council 
                Resolutions because that trade is fueling conflict;
                    (B) in the case of rough diamonds not covered by 
                subparagraph (A), rough diamonds used by any armed 
                movement or an ally of an armed movement to finance or 
                sustain operations to carry out systematic human rights 
                abuses or attacks against unarmed civilians; or
                    (C) diamonds that evidence shows fund the al-Qaeda 
                international terrorist network and related groups 
                designated under Executive Order No. 13224 of September 
                23, 2001 (66 Federal Register 49079).
            (2) Diamonds.--The term ``diamonds'' means diamonds 
        classifiable under subheading 7102.31.00 or subheading 
        7102.39.00 of the Harmonized Tariff Schedule of the United 
        States.
            (3) Polished diamonds.--The term ``polished diamonds'' 
        means diamonds classifiable under subheading 7102.39.00 of the 
        Harmonized Tariff Schedule of the United States.
            (4) Rough diamonds.--The term ``rough diamonds'' means 
        diamonds that are unworked, or simply sawn, cleaved, or bruted, 
        classifiable under subheading 7102.31.00 of the Harmonized 
        Tariff Schedule of the United States.
            (5) United states.--The term ``United States'', when used 
        in the geographic sense, means the several States, the District 
        of Columbia, and any commonwealth, territory, or possession of 
        the United States.

SEC. 4. MEASURES TO PREVENT IMPORTS OF CONFLICT DIAMONDS.

    (a) Authority of the President.--Notwithstanding any other 
provision of law, the President shall prohibit, in whole or in part, 
the importation into the United States of rough diamonds, and may 
prohibit the importation into the United States of polished diamonds 
and jewelry containing diamonds, from any country that does not take 
effective measures to stop trade in conflict diamonds as long as the 
prohibition is consistent with the foreign policy interests of the 
United States, including the international obligations of the United 
States, or is pursuant to United Nations Security Council Resolutions 
on conflict diamonds.
    (b) Effective Measures.--For purposes of this Act, effective 
measures are measures that--
            (1) meet the requirements of United Nations Security 
        Council Resolutions on trade in conflict diamonds;
            (2) meet the requirements of an international arrangement 
        on conflict diamonds, including the recommendations of the 
        Kimberley Process, as long as the measures also meet the 
        requirements of United Nations Security Council Resolutions on 
        trade in conflict diamonds; or
            (3) contain the following elements, or their functional 
        equivalent, if such elements are sufficient to meet the 
        requirements of United Nations Security Council Resolutions on 
        trade in conflict diamonds:
                    (A) With respect to exports from countries where 
                rough diamonds are extracted, secure packaging, 
                accompanied by officially validated documentation 
                certifying the country of origin, total carat weight, 
                and value.
                    (B) With respect to exports from countries where 
                rough diamonds are extracted, a system of verifiable 
                controls on rough diamonds from mine to export.
                    (C) With respect to countries that reexport rough 
                diamonds, a system of controls designed to ensure that 
                no conflict diamonds have entered the legitimate trade 
                in rough diamonds.
                    (D) Verifiable recordkeeping by all companies and 
                individuals engaged in mining, import, and export of 
                rough diamonds within the territory of the exporting 
                country, subject to inspection and verification by 
                authorized government authorities in accordance with 
                national regulations.
                    (E) Government publication on a periodic basis of 
                official rough diamond export and import statistics.
                    (F) Implementation of proportionate and dissuasive 
                penalties against any persons who violate laws and 
                regulations designed to combat trade in conflict 
                diamonds.
                    (G) Full cooperation with the United Nations or 
                other official international bodies examining the trade 
                in conflict diamonds, especially with respect to any 
                inspection and monitoring of the trade in rough 
                diamonds.
    (c) Exclusions.--The provisions of this section do not apply to--
            (1) rough diamonds imported by or on behalf of a person for 
        personal use and accompanying a person upon entry into the 
        United States; or
            (2) rough diamonds previously exported from the United 
        States and reimported by the same importer, without having been 
        advanced in value or improved in condition by any process or 
        other means while abroad, if the importer declares that the 
        reimportation of the rough diamonds satisfies the requirements 
        of this paragraph.

SEC. 5. PROHIBITION OF POLISHED DIAMONDS AND JEWELRY.

    The President shall prohibit specific entries into the customs 
territory of the United States of polished diamonds and jewelry 
containing diamonds if the President has credible evidence that such 
polished diamonds and jewelry were produced with conflict diamonds.

SEC. 6. ENFORCEMENT.

    (a) In General.--Diamonds and jewelry containing diamonds imported 
into the United States in violation of any prohibition imposed under 
section 4 or 5 are subject to the seizure and forfeiture laws, and all 
criminal and civil laws of the United States shall apply, to the same 
extent as any other violation of the customs and navigation laws of the 
United States.
    (b) Proceeds From Fines and Forfeited Goods.--Notwithstanding any 
other provision of law, the proceeds derived from fines imposed for 
violations of section 4(a), and from the seizure and forfeiture of 
goods imported in violation of section 4(a), shall, in addition to 
amounts otherwise available for such purposes, be available only for--
            (1) the Leahy War Victims Fund administered by the United 
        States Agency for International Development or any successor 
        program to assist victims of foreign wars; and
            (2) grants under section 131 of the Foreign Assistance Act 
        of 1961 (22 U.S.C. 2152a).

SEC. 7. REPORTS.

    (a) Annual Reports.--Not later than one year after the effective 
date of this Act, and every 12 months thereafter, the President shall 
transmit to Congress a report--
            (1) describing actions taken by countries that have 
        exported diamonds to the United States during the preceding 12-
        month period to implement effective measures to stop trade in 
        conflict diamonds;
            (2) describing any new technologies since the date of 
        enactment of this Act for marking diamonds or determining the 
        origin of rough diamonds;
            (3) identifying those countries that have exported diamonds 
        to the United States during the preceding 12-month period and 
        are not implementing effective measures to stop trade in 
        conflict diamonds and whose failure to do so has significantly 
        increased the likelihood that conflict diamonds are being 
        imported into the United States;
            (4) describing appropriate actions, which may include 
        actions under sections 4 and 5, that may be taken by the United 
        States, or actions that may be taken or are being taken by each 
        country identified under paragraph (3), to ensure that conflict 
        diamonds are not being imported into the United States from 
        such country; and
            (5) identifying any additional countries involved in 
        conflicts linked to rough diamonds that are not the subject of 
        United Nations Security Council Resolutions on conflict 
        diamonds.
    (b) Semiannual Reports.--For each country identified in subsection 
(a)(3), the President shall, every 6 months after the initial report in 
which the country was identified, transmit to Congress a report that 
explains what actions have been taken by the United States or such 
country since the previous report to ensure that conflict diamonds are 
not being imported from that country into the United States. The 
requirement to issue a semiannual report with respect to a country 
under this subsection shall remain in effect until such time as the 
country implements effective measures.

SEC. 8. GAO REPORT.

    Not later than 3 years after the effective date of this Act, the 
Comptroller General of the United States shall transmit a report to 
Congress on the effectiveness of the provisions of this Act in 
preventing the importation of conflict diamonds under section 4. The 
Comptroller General shall include in the report any recommendations on 
any modifications to this Act that may be necessary.

SEC. 9. SENSE OF CONGRESS.

    (a) International Arrangement.--It is the sense of Congress that 
the President should take the necessary steps to negotiate an 
international arrangement, working in concert with the Kimberley 
Process referred to in section 2(6), to eliminate the trade in conflict 
diamonds. Such an international arrangement should create an effective 
global system of controls covering countries that export and import 
rough diamonds, should contain the elements described in section 
4(b)(3), and should address independent monitoring, the collection of 
reliable statistics on the diamond trade, and the need for a 
coordinating body or secretariat to implement the arrangement.
    (b) Additional Security Council Resolutions.--It is the sense of 
Congress that the President should take the necessary steps to seek 
United Nations Security Council Resolutions with respect to trade in 
diamonds from additional countries identified under section 7(a)(5).
    (c) Trade in Legitimate Diamonds.--It is the sense of Congress that 
the provisions of this Act should not impede the trade in legitimate 
diamonds with countries which are working constructively to eliminate 
trade in conflict diamonds, including through the negotiation of an 
effective international arrangement to eliminate trade in conflict 
diamonds.
    (d) Implementation of Effective Measures.--It is the sense of 
Congress that companies involved in diamond extraction and trade should 
make financial contributions to countries seeking to implement any 
effective measures to stop trade in conflict diamonds described in 
section 4(b), if those countries would have financial difficulty 
implementing those measures.

SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated to the President $5,000,000 
for each of the fiscal years 2002 and 2003 to provide assistance to 
countries seeking to implement any effective measures to stop trade in 
conflict diamonds described in section 4(b), if those countries would 
have financial difficulty implementing those measures.

SEC. 11. EFFECTIVE DATE.

    This Act shall take effect on the date of the enactment of this 
Act.
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