[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 787 Introduced in Senate (IS)]







107th CONGRESS
  1st Session
                                 S. 787

 To prohibit the importation of diamonds from countries that have not 
    become signatories to an international agreement establishing a 
certification system for exports and imports of rough diamonds or that 
 have not unilaterally implemented a certification system meeting the 
                      standards set forth herein.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 26, 2001

  Mr. Gregg introduced the following bill; which was referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To prohibit the importation of diamonds from countries that have not 
    become signatories to an international agreement establishing a 
certification system for exports and imports of rough diamonds or that 
 have not unilaterally implemented a certification system meeting the 
                      standards set forth herein.

    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 ``Conflict Diamonds Act of 2001''.

        TITLE I--PROHIBITION ON IMPORTATION OF CONFLICT DIAMONDS

SEC. 101. FINDINGS.

    The Congress finds that:
            (1) The use of funds from illegitimate diamond trade to 
        support conflicts in Africa has had devastating effects on the 
        peoples of the regions involved in those conflicts.
            (2) U.N. Security Council Resolution 1173 of June 12, 1998, 
        requires the United States and all other U.N. members to take 
        the necessary measures to prohibit the direct or indirect 
        importation from Angola to their territory of all diamonds that 
        are not controlled through the Certificate of Origin regime of 
        the Government of Unity and National Reconciliation (GURN).
            (3) U.N. Security Council Resolution 1306 of July 5, 2000, 
        requires the United States and all other U.N. members to take 
        the necessary measures to prohibit the direct or indirect 
        importation of all rough diamonds from Sierra Leone into their 
        territory that are not controlled by the Government of Sierra 
        Leone through its Certificate of Origin regime.
            (4) U.N. Security Council Resolution 1344 of March 8, 2001, 
        requires the United States and all other U.N. members to take 
        the necessary measures to prevent the direct or indirect import 
        of all rough diamonds from Liberia, whether or not such 
        diamonds originated in Liberia.
            (5) Effective compliance with U.N. Security Council 
        Resolutions 1173, 1306, and 1344 is necessary to eliminate 
        trade in conflict diamonds.
            (6) Although the President of the United States has issued 
        Executive Orders to implement Resolution 1173 and Resolution 
        1306, additional measures are needed to ensure compliance with, 
        and prevent circumvention of, those resolutions.
            (7) Further measures are needed to prevent rough diamonds 
        originating in other rebel-controlled conflict areas from 
        entering the global stream of commerce in which legitimate 
        diamonds are sold.
            (8) The resolution of the United Nations General Assembly 
        approved on December 1, 2000, provides important guidance on 
        devising effective and pragmatic measures to address the 
        problem of conflict diamonds.
            (9) Since legitimate diamond trade is of great economic 
        importance to developing countries in Africa, no law should be 
        enacted, nor regulation or other measure implemented, that 
        would impede legitimate diamond trade or diminish confidence in 
        the integrity of the legitimate diamond industry.

SEC. 102. DEFINITIONS.

    (a) The term ``diamond'' means a natural mineral consisting of 
essentially pure carbon crystallized in the isometric system with a 
hardness of 10 on the Mohs scale, a specific gravity of approximately 
3.52, and a refractive index of 2.42.
    (b) The term ``rough diamond'' means a diamond that is unworked or 
simply sawn, cleaved or bruted, as described in Harmonized Tariff 
Schedule of the United States subheading 7102.31.0000.
    (c) The term ``conflict diamond'' means a diamond that has at any 
time been in the possession of any person belonging to or associated 
with armed insurgents, rebel forces, or any other movement using 
violence against civilians or internationally recognized governments.

SEC. 103. RESTRICTIONS ON THE IMPORTATION OF DIAMONDS.

    (a) No person may enter into the customs territory of the United 
States or aid or abet an attempt to enter any diamond, including any 
diamond set in jewelry, that has been mined in, or mined and set in, 
and exported directly from, the Republic of Sierra Leone, the Republic 
of Angola, or the Republic of Liberia except for a diamond or a diamond 
set in jewelry--
            (1) the country of origin of which has been certified as 
        the Republic of Sierra Leone by the internationally recognized 
        government of that country, in accordance with United Nations 
        Security Council Resolution 1306 of July 5, 2000; or
            (2) the country of origin of which has been certified as 
        the Republic of Angola by the internationally recognized 
        government of that country, in accordance with United Nations 
        Security Council Resolution 1173 of June 12, 1998.
    (b) No person may enter into the customs territory of the United 
States or aid or abet an attempt to enter any diamond directly from a 
country that: is subject to a United Nations Security Council 
resolution similar to those identified in subsection (a) or that is not 
a signatory to an international agreement that establishes a 
certification system for exports and imports of rough diamonds, that 
has not unilaterally implemented such a system, or that is not a 
``cooperating country'' as defined in subsection (c) of section 105 of 
this Act.

SEC. 104. PROHIBITION OF OTHER IMPORTS TO PREVENT CIRCUMVENTION OF U.N. 
              RESOLUTIONS.

    The President of the United States is authorized to prohibit the 
importation of diamonds or diamond jewelry exported from any country 
except for rough diamonds whose country of origin has been certified as 
either the Republic of Angola or the Republic of Sierra Leone under the 
Certificate of Origin regimes described in section 103 (a) (1) or (2), 
if there are reasonable grounds to believe that such prohibition is 
necessary to carry out U.N. Security Council Resolution 1173, 1306, or 
1344, or any other Resolution banning the exportation or importation of 
conflict diamonds.

SEC. 105. IMPLEMENTING MEASURES.

    (a) The Secretary of the Treasury of the United States is 
authorized to make such rules and regulations as may be necessary to 
carry out the provisions of this Act. The public will be notified and 
given an opportunity of at least 30 days to comment on all proposed 
rules and regulations before they take effect.
    (b) These regulations will provide that an importer is entitled to 
rely on the country of origin marking that is required under 19 U.S.C. 
Sec. 1304. However, nothing in this Act shall be construed to override 
an importer's duty to exercise reasonable care.
    (c) No later than six months after the date of enactment of this 
Act, the Secretary of the Treasury will issue a list of countries that 
are signatories to the international agreement described in title II, 
have unilaterally implemented a certification system containing the 
elements described in subsection (b) of section 203, or are found to be 
``cooperating'' countries as defined in this subsection. The Secretary 
of the Treasury will revise and update this list as necessary. For 
purposes of this subsection, the Secretary of the Treasury will find 
that a country is ``cooperating'' if it is acting in good faith to 
establish and enforce a unilateral certification system meeting the 
standards described in subsection (b) of section 203 or taking action 
to ensure that it is not facilitating trade in conflict diamonds. The 
Secretary of the Treasury, in consultation with appropriate agencies, 
shall develop and publish criteria that will be used to evaluate 
whether a country will be deemed a cooperating country. These criteria 
will be subject to public notice and comment before adoption in final 
form.
    (d) The Secretary of the Treasury may extend cooperating country 
status for more than six months after the initial designation, but 
shall provide to Congress an explanation of the reasons for why such an 
extension is necessary.
    (e) The President of the United States shall ensure that 
implementation of and compliance with title I of this Act is monitored 
by appropriate agencies or by an independent body.

SEC. 106. PENALTIES FOR NONCOMPLIANCE.

    (a) Civil and Criminal Penalties.--Any person who enters or 
introduces into the commerce of the United States, attempts to enter or 
introduce, or aids or abets an attempt to enter or introduce, 
merchandise in violation of title I of this Act or the implementing 
regulations for title I will be subject to civil and criminal penalties 
in effect under the customs laws of the United States, as set forth in 
title 19 of the United States Code. The same administrative procedures 
and defenses that apply under title 19 of the United States Code will 
apply to penalties that are sought to be assessed under this 
subsection.
    (b) Seizure.--If the Customs Service has reasonable cause to 
believe that a person has violated the provisions of subsection (a) of 
this section and that seizure is essential to prevent the introduction 
of merchandise into the customs territory of the United States whose 
importation is prohibited by title I of this Act, then such merchandise 
may be seized. Within a reasonable time after any such seizure is made, 
the Customs Service will issue to the person concerned a written 
statement containing the reasons for the seizure. A person may seek 
relief from seizure under the procedures and standards prescribed in 19 
U.S.C. Sec. 1618 and the Customs Service regulations that implement 
that provision.
    (c) Court of International Trade Proceedings.--
            (1) Jurisdiction.--Section 1582 of title 28, United States 
        Code, is amended by amending paragraph (1) to read as follows:
            ``(1) to recover a civil penalty under section 592, 593A, 
        641(b)(6), 641(d)(2)(A), 704(i)(2), or 734(i)(2) of the Tariff 
        Act of 1930.''.
            (2) Standard of review.--Notwithstanding any other 
        provision of law, in any proceeding commenced by the United 
        States in the Court of International Trade for the recovery of 
        any monetary penalty under this section, all issues, including 
        the amount of any penalty, shall be tried de novo.
    (d) Proceeds From Fines and Seized Goods.--The proceeds derived 
from penalties and seizures under title I of this Act will, in addition 
to amounts otherwise available for such purposes, be available only for 
programs to assist the victims of conflicts involving illicitly traded 
diamonds.

SEC. 107. REPORT TO CONGRESS.

    The President of the United States will report to Congress no later 
than 180 days after enactment of this Act and annually thereafter on 
the implementing measures taken to carry out the provisions of this 
title and their effectiveness in stopping imports of conflict diamonds 
into the United States.

TITLE II--NEGOTIATION OF AN INTERNATIONAL AGREEMENT TO ELIMINATE TRADE 
                          IN CONFLICT DIAMONDS

SEC. 201. FINDINGS.

    The Congress finds that:
            (1) The most effective and desirable means of eliminating 
        international trade in conflict diamonds is through 
        international cooperative efforts involving governments, the 
        private sector, civil society, and appropriate international 
        organizations.
            (2) The initiatives of the world diamond industry, as 
        reflected in the Resolution of the World Federation of Diamond 
        Bourses and the International Diamond Manufacturers Association 
        in Antwerp on July 19, 2000, as well as the efforts of the 
        South African-led Working Group on African Diamonds and the 
        World Diamond Council in developing proposals for a global 
        certification system for rough diamonds, are important efforts 
        at international cooperation and may provide effective 
        mechanisms that could be incorporated in an international 
        agreement to eliminate trade in conflict diamonds.
            (3) Eliminating imports of rough diamonds from countries 
        where conflict diamonds are mined, transshipped, or 
        subsequently shipped into countries where cutting and polishing 
        occur is the most effective way to eliminate trade in conflict 
        diamonds.

SEC. 202. SENSE OF CONGRESS--NEGOTIATION OF INTERNATIONAL AGREEMENT.

    It is the sense of the Congress that the President should engage in 
negotiations on and seek to conclude an international agreement to 
eliminate trade in conflict diamonds as soon as possible. The system 
implementing this agreement shall be transparent and subject to 
independent verification and monitoring. Participants in such an 
agreement should include all countries that either export or import 
diamonds or diamond jewelry.

SEC. 203. OVERALL NEGOTIATING OBJECTIVE OF THE UNITED STATES AND 
              ESSENTIAL ELEMENTS OF AN INTERNATIONAL AGREEMENT.

    (a) The overall negotiating objective of the United States is to 
establish an effective global certification system covering the major 
exporting and importing countries of rough diamonds that will eliminate 
trade in conflict diamonds.
    (b) The elements of an effective global certification system for 
rough diamonds that the United States should seek in its negotiations 
are as follows:
            (1) Rough diamonds, when exported from the country in which 
        they were extracted, must be sealed in a secure, transparent 
        container or bag by appropriate government officials of that 
        country.
            (2) The sealed container described in paragraph (1) must 
        include a fully visible government document certifying the 
        country of extraction and recording a unique export 
        registration number and the total carat weight of the rough 
        diamonds enclosed.
            (3) A database containing information described in 
        paragraph (2) must be established for rough diamond exports in 
        each exporting country, including countries engaged in the re-
        export of rough diamonds.
            (4) No country may allow importation of rough diamonds 
        unless they are sealed in a secure, transparent container that 
        includes a fully visible document that states a unique export 
        registration number for such container and the total carat 
        weight of the rough diamonds enclosed. The legitimacy of such 
        document must be verified by electronic or other reliable means 
        with the database maintained in the country of export.
            (5) Provisions shall be made for physical inspection of 
        sealed containers of rough diamonds by appropriate authorities.
            (6) Diamonds may be freely imported and exported from a 
        country that implements and enforces a rough diamond 
        certification system that contains the elements specified in 
        paragraphs (1) through (5), or a system that is its functional 
        equivalent, provided that the country of extraction need only 
        be specified when rough diamonds are exported from such country 
        and need not be specified when rough diamonds are exported from 
        a country that implements and enforces such a rough diamond 
        certification system.

SEC. 204. CONSULTATIONS WITH CONGRESS.

    The President of the United States shall consult periodically with 
Congress in developing and negotiating proposals for an international 
agreement as described in sections 202 and 203.

SEC. 205. REPORT TO CONGRESS.

    The President of the United States will provide a written report to 
Congress no later than 180 days after enactment of this Act and 
annually thereafter on the progress made towards concluding an 
international agreement and the progress of the signatories to that 
agreement in implementing it, including which countries are not 
implementing it and the effects of their actions on trade in conflict 
diamonds. Each report shall also describe any technological advances 
that permit determining a diamond's origin, marking a diamond, and 
tracking it.

SEC. 206. IMPLEMENTING LEGISLATION.

    The President of the United States will submit to Congress a draft 
bill implementing the provisions of any agreement that is negotiated no 
later than 60 calendar days after entering into that agreement.

SEC. 207. EFFECTIVE DATE.

    Title I will apply with respect to articles entered, or withdrawn 
from warehouse for consumption, six months after the date of enactment 
of this Act. Title II will take effect on the date of enactment of this 
Act.

                      TITLE III--OTHER PROVISIONS

SEC. 301. AUTHORIZATION OF APPROPRIATIONS.

    Such sums as may be necessary are hereby authorized to be 
appropriated to implement the provisions of this Act, including such 
sums as are necessary to assist the governments of Sierra Leone and 
Angola to establish and maintain a diamond certification system.

SEC. 302. SEVERABILITY.

    If any provision of this Act or the application of such provision 
to any person or circumstance is held invalid, it is the intent of 
Congress that the remainder of this Act and application of such 
provision to other persons or circumstances will not be affected 
thereby.

SEC. 303. GAO REPORT.

    The General Accounting Office shall report to Congress on the 
effectiveness of this Act no later than three years after the date of 
enactment of this Act.
                                 <all>