[Federal Register Volume 83, Number 159 (Thursday, August 16, 2018)]
[Rules and Regulations]
[Pages 40665-40675]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-17454]
[[Page 40665]]
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FEDERAL TRADE COMMISSION
16 CFR Part 23
Guides for the Jewelry, Precious Metals, and Pewter Industries
AGENCY: Federal Trade Commission.
ACTION: Final rule; adoption of revised guides.
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SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'')
adopts revised Guides for the Jewelry, Precious Metals, and Pewter
Industries (``Jewelry Guides'' or ``Guides''). This document summarizes
the Commission's revisions to the previous Guides and includes the
final Guides as revised. Readers can find the Commission's complete
analysis in the Statement of Basis and Purpose (``SBP'') on the FTC's
website at https://www.ftc.gov/public-statements/2018/07/statement-basis-purpose-final-revisions-jewelry-guides.
DATES: Effective on August 16, 2018.
FOR FURTHER INFORMATION CONTACT: Reenah L. Kim, Attorney, (202) 326-
2272, Division of Enforcement, Bureau of Consumer Protection, Federal
Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580.
SUPPLEMENTARY INFORMATION: As part of its comprehensive review of the
Jewelry Guides, the Commission reviewed public comments and the
transcript of a public roundtable. The Commission developed its final
guidance in accordance with Section 5 of the Federal Trade Commission
Act (``FTC Act''), which prohibits deceptive or unfair acts or
practices.\1\ The Guides focus on advising marketers how to make non-
deceptive claims about jewelry products, rather than preventing unfair
practices.\2\ Under Section 5, an act or practice is deceptive if it
involves a material statement or omission that would mislead a consumer
acting reasonably under the circumstances.\3\
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\1\ 15 U.S.C. 45.
\2\ Although the Guides focus on deception, the FTC can also
address unfair practices should the need arise.
\3\ FTC Policy Statement on Deception, appended to Cliffdale
Assoc., Inc., 103 FTC 110 (1984); see also FTC v. Verity Int'l, 443
F.3d 48, 63 (2d Cir. 2006); FTC v. Pantron I Corp., 33 F.3d 1088,
1095 (9th Cir. 1994). Under Section 5, an act or practice is unfair
if it causes or is likely to cause substantial injury that consumers
could not reasonably avoid, and the injury is not outweighed by
countervailing benefits to consumers or competition. 15 U.S.C.
45(n).
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As administrative interpretations of Section 5, the Commission's
Jewelry Guides are not intended to be stricter than Section 5. Rather,
they provide the Commission's interpretation of Section 5 as applied to
jewelry marketing, to help marketers avoid deceptive practices. To
comply with Section 5, marketers must consider how reasonable consumers
will view their claims as a whole, assessing the net impression
conveyed by all elements (including the text, product names, and
depictions).\4\
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\4\ See generally Deception Policy Statement, appended to
Cliffdale Assoc., Inc., 103 FTC at 179 (1984).
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When the Commission issues or revises an industry guide, it is
providing an administrative interpretation of laws it administers,
including Section 5's prohibition on unfair and deceptive acts or
practices in or affecting commerce. The Commission provides its
administrative interpretation based on information submitted and any
other information available, including consumer perception evidence
whenever possible, analyzing the information through the reasonable
person standard first set forth in the Deception Policy Statement in
1983, and the unfairness standard, first set forth in the Unfairness
Policy Statement announced in 1984 and codified in Section 5(n) of the
FTC Act. Applying the reasonable consumer standard supported by
consumer perception evidence as the Commission revises the Jewelry
Guides (which originally predated the two policy statements) enhances
the protection of consumers from the harm of false or misleading claims
in jewelry marketing and fosters truthful, non-misleading claims in
jewelry marketing that are beneficial to consumers and competition.
Based on this framework, the Commission now makes several modifications
and additions to the previous Guides and adopts the resulting revised
Guides as final. Specifically, the Commission revises the following
areas: (I) Surface application of precious metals; (II) alloys with
precious metals in amounts below minimum thresholds; (III) products
containing more than one precious metal; (IV) composite gemstone
products; (V) varietals; (VI) ``cultured'' diamonds; (VII) qualifying
claims about man-made gemstones; (VIII) pearl treatment disclosures;
(IX) use of the term ``gem''; (X) misleading illustrations; (XI)
diamond definition; and (XII) exemptions recognized in the assay for
gold, silver, and platinum. Finally, the Commission does not expand the
existing Guides to address certain products and claims as requested by
commenters.
Surface Application of Precious Metals
The final Guides include several revisions addressing precious
metal surface applications. First, based on the comments, the Guides
now caution marketers against using silver or platinum terms to
describe all or part of a coated product unless they adequately qualify
the term to indicate the product has only a surface layer of the
advertised precious metal.\5\ The Guides retain similar guidance
advising marketers not to use gold terms to describe coated products or
parts unless the term is qualified to convey that the gold is only on
the surface.\6\
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\5\ Sections 23.5(b)(4) (silver) and 23.6(b)(1) (platinum).
\6\ Section 23.3(b)(3).
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Second, for sellers choosing to advertise their products' precious
metal coatings, the final Guides advise how to do so non-deceptively.
Specifically, they advise marketers advertising their product's gold,
silver, or platinum coating to assure its reasonable durability. In
this context, ``reasonable durability'' means ``all areas of the
plating are sufficiently thick to assure coverage that reasonable
consumers would expect from the surface application.'' \7\
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\7\ Sections 23.3(b)(4), (5), (6), and (8), (c)(2) and (3)
(gold); 23.5(b)(5) (silver); and 23.6(b)(2) (platinum).
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Third, based on new durability testing, the final Guides include
revised examples of non-deceptive markings and descriptions for gold
surface applications that are reasonably durable.\8\ For electrolytic
applications, the Guides retain the same thickness and karat fineness
amounts as the previous Guides, but no longer advise marketers they may
non-deceptively use ``gold flashed'' and ``gold washed'' for products
with an electroplating that does not have a minimum thickness
throughout equivalent to 0.175 microns (approximately 7/1,000,000ths of
an inch) of fine gold. For mechanical applications, the Guides now
advise a 1/40th minimum weight ratio for non-deceptive use of the terms
``gold plate(d),'' \9\ ``gold overlay,'' ``rolled gold plate.'' \10\ In
addition, the Guides retain existing guidance advising a 1/20th weight
ratio for ``gold filled'' products, and the guidance advising marketers
to
[[Page 40666]]
disclose weight ratio when using ``gold overlay'' or ``rolled gold
plate'' for products below 1/20th.\11\
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\8\ These examples are also referred to as ``safe harbor''
guidance.
\9\ As proposed, the final Guides eliminate the safe harbor
provision for ``gold plate(d)'' coatings applied by any method and
transfer this term to guidance that separately addresses
electrolytic and mechanical applications.
\10\ Section 23.3(c)(2). As explained in the SBP, the Guides
advise a minimum weight ratio, rather than the previously proposed
coating thickness, based on new evidence indicating that 1/40th
provides the durability consumers expect.
\11\ Section 23.3(c)(2). As proposed, the final Guides eliminate
a note concerning outdated terms (e.g., ``Duragold,'' ``Diragold'')
which commenters agreed are no longer used. However, they do not set
standards for new coating terms (e.g., ``clad,'' ``bonded'') or
other precious metal coatings such as silver or platinum.
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Fourth, the final Guides advise marketers to disclose the purity of
coatings made with a gold, silver, or platinum alloy. The Guides
already caution marketers against unqualified use of ``gold,''
``silver,'' or ``platinum'' to describe alloys containing less than 24K
gold, 925 PPT silver, or 950 PPT platinum. To clarify that this
guidance applies equally to products coated with a gold, silver, or
platinum alloy, the Commission amends the guidance to advise that
marketers qualify their use of gold, silver, or platinum terms to
describe ``all or part'' of a product, ``including the surface layer of
a coated product,'' with equally conspicuous, accurate purity
disclosures.\12\
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\12\ Sections 23.3(b)(1) and (2) (gold); 23.5(b)(1) (silver);
and 23.6(b)(3) (platinum). In addition, based on the comments, the
Guides now include karat fineness disclosures in the description and
marking examples for gold electrolytic applications, consistent with
the examples for mechanical applications. Section 23.3(b)(5), (6),
and (8); 23.3(c)(2) and (3).
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Finally, the final Guides advise marketers to disclose rhodium
coatings over products advertised as precious metal, such as rhodium-
plated items marketed as ``white gold'' or silver.\13\
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\13\ Rhodium is a platinum group metal often used to enhance the
white color of silver and white gold jewelry. Section 23.7.
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Below-Threshold Precious Metal Alloys
The previous Guides cautioned marketers against using the words
``gold,'' ``silver,'' ``platinum,'' or their abbreviations to describe
or mark a product unless it contained the precious metal in an amount
that met or exceeded specified thresholds. The final Guides remove the
thresholds for gold and silver alloys because new evidence indicates
they are no longer necessary to prevent deception. Specifically, the
final Guides now advise marketers they may use gold terms to describe a
product or part thereof composed throughout of gold alloy--whether
above or below 10 karats--if they qualify the term with an equally
conspicuous, accurate karat fineness disclosure.\14\ The final Guides
also advise marketers they may use ``silver'' to describe a product or
part thereof composed throughout of an alloy containing less than 925
parts per thousand (PPT), as long as an equally conspicuous, accurate
PPT designation immediately precedes the silver term.\15\ These changes
will give marketers greater flexibility in providing accurate
information about their products' content.
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\14\ Section 23.3(b)(2).
\15\ Section 23.5(b)(1).
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However, the final Guides retain the guidance advising a 925 PPT
threshold for ``solid silver,'' ``Sterling Silver,'' ``Sterling,'' and
the ``Ster.'' Abbreviation,\16\ and reserving ``coin'' and ``coin
silver'' for products that are 900 PPT,\17\ based on their longstanding
use and therefore probable consumer understanding. Rather than merely
signaling the presence of silver, these terms likely denote specific
purity levels (e.g., that ``coin silver'' contains less silver than
``sterling silver''). In addition, the Guides retain the existing
platinum alloy guidance without change because the record indicates
that, unlike gold and silver, which have traditionally been mixed with
base metals to create jewelry, consumers expect platinum products to be
substantially composed of pure platinum.
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\16\ Section 23.5(b)(2).
\17\ Section 23.5(b)(3).
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Products Containing More Than One Precious Metal
Based on consumer perception evidence, the final Guides contain a
new section (Section 23.8), which states it is unfair or deceptive to
misrepresent the relative quantity of each precious metal in a product
that contains more than one precious metal, and provides examples of
markings and descriptions of terms that may be misleading (e.g., use of
the term ``Platinum + Silver'' to describe a product that contains more
silver than platinum by weight). This guidance generally advises
marketers to list precious metals in the order of their relative weight
in the product from greatest to least. Marketers, however, may list
metals in a different order if the context makes clear that the metal
listed first is not predominant (e.g., ``14k gold-accented silver''),
and the Guides provide illustrative examples of such contexts.
Composite Gemstone Products
Based on the record, the final Guides contain new guidance in
Section 23.25 to address increased prevalence of deceptive claims
resulting from the marketing of composite gemstone products made with
gemstone material and any amount of filler or binder, such as lead
glass. Specifically, this guidance cautions marketers not to use an
unqualified gemstone name to describe these products, and advises
against calling them ``treated [gemstone name].'' It also cautions
against using the unqualified terms ``composite [gemstone name],''
``hybrid [gemstone name],'' or ``manufactured [gemstone name]'' unless
the term is qualified to disclose clearly and conspicuously that the
product: (a) Does not have the same characteristics as the named stone;
and (b) requires special care. The final Guides further recommend that
the seller disclose the special care requirements to the purchaser.\18\
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\18\ Section 23.25(d).
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Varietals
Based on consumer perception evidence, Section 23.26 contains new
guidance stating it is unfair or deceptive to mark or describe a
product with an incorrect varietal name. Varietal names describe a
division of gem species or genus based on color, type of optical
phenomenon, or other distinguishing characteristic of appearance (e.g.,
crystal structure). To help sellers avoid making deceptive claims, this
section also provides two examples of markings or descriptions that may
be misleading: (a) Use of the term ``yellow emerald'' to describe a
golden beryl or heliodor, and (b) use of the term ``green amethyst'' to
describe prasiolite.
``Cultured'' Diamonds
The final Guides include new guidance addressing use of the word
``cultured'' to describe laboratory-created diamonds. Based on consumer
perception evidence showing marketers can effectively qualify the term,
Section 23.12(c)(3) advises them to qualify their use of ``cultured''
by disclosing clearly and conspicuously that the product is not a mined
stone. Additionally, the record indicates that marketers can
effectively qualify the term ``cultured diamond'' in some circumstances
even when the Guides' suggested disclosures (``laboratory-created,''
``laboratory-grown,'' ``[manufacturer-name]-created'') do not appear in
immediate conjunction to the term. For example, some lab-created
diamond sellers may choose to emphasize their products' man-made nature
in advertisements targeting consumers seeking diamonds that are not
traditionally mined. Therefore, to provide greater flexibility, the
final Guides advise that marketers may qualify their ``cultured
diamond'' claim with words or phrases similar to those detailed in the
Guides. Moreover, these marketers do not need to make these qualifying
disclosures immediately adjacent to the word ``cultured,'' provided
they disclose
[[Page 40667]]
clearly and conspicuously that the product is not a mined stone.
Qualifying Claims About Man-Made Gemstones
To provide marketers greater flexibility, the final Guides also
include revisions to the guidance regarding the use of gemstone names
generally (Section 23.25(b)). This amended guidance now advises
marketers of man-made gemstones sharing the same optical, physical, and
chemical properties as the named stone that they may use words or
phrases other than the ones listed in the previous Guides
(``laboratory-grown,'' ``laboratory-created,'' ``[manufacturer name]-
created,'' ``synthetic'') if they clearly and conspicuously convey that
the product is not a mined stone.
Treatments to Pearl Products
Based on the comments, the final Guides include a new section
(Section 23.23) advising that marketers disclose clearly and
conspicuously treatments to pearls and cultured pearls that: (a) Are
not permanent, (b) create special care requirements, or (c)
significantly affect value.\19\
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\19\ This new section tracks the existing guidance regarding
gemstone treatments.
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Use of the Term ``Gem''
The final Guides eliminate two provisions that discussed use of the
word ``gem'' because they are not necessary to prevent deception.
Specifically, the final Guides do not include the former Section 23.25
(Misuse of the word ``gem'') and Section 23.20(j) (misuse of the word
``gem'' as to pearls). Instead, they include the term ``gem'' in
Section 23.25 (Misuse of the words ``ruby,'' ``sapphire,'' ``emerald,''
``topaz, ``stone,'' ``birthstone,'' ``gemstone,'' etc.).
Misleading Illustrations
To streamline the guidance, the final Guides also eliminate a
section that discussed misleading illustrations (former Section 23.2)
because it provided guidance already addressed in other areas: Section
23.1 (Deception (general)) and Section 23.0 (Scope and application). To
preserve its specific guidance regarding diamond illustrations and
gemstone size, however, the former Note to Section 23.2 has been
transferred to Section 23.1.
Diamond Definition
Based on changes in the market, the final Guides eliminate the word
``natural'' from the definition of diamond in Section 23.12(a) because
lab-created products that have essentially the same optical, physical,
and chemical properties as mined diamonds are also diamonds.\20\
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\20\ The distinctions between these lab-created diamonds and
mined stones are addressed elsewhere in the Guides. See Sections
23.12(c)(3) and 23.25.
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Exemptions in the Assay for Gold, Silver, and Platinum
Based on the comments, the final Guides add bracelet and necklace
snap tongues to the exempted items listed in the Appendix for gold
alloy products and for products made of silver in combination with
gold. These items are already included in the exemptions for
mechanically-coated gold products, silver products, and platinum
products. Thus, with this revision, bracelet and necklace snap tongues
appear in each section addressing assay exemptions.\21\
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\21\ Furthermore, the Commission removes an outdated provision
in paragraph (e) of the Appendix regarding platinum. The provision
listed additional exemptions for items marked in accordance with
guidance that once addressed products containing less than 500 PPT
platinum. Because the Commission eliminated this guidance in a prior
proceeding, the corresponding list of assay exemptions is no longer
necessary. See 62 FR 16669, 16674 (Apr. 8, 1997). The final Appendix
therefore retains the exemptions for platinum products, but does not
include additional exemptions for products with less than 500 PPT.
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Products and Claims Not Addressed
The final Guides do not make some revisions that commenters sought.
Specifically, the final Guides do not expand the existing guidance to
address products made with palladium, use of the term ``natural'' to
describe treated gemstones, or the use of geographic and regional
identifiers because the evidence does not demonstrate that amendments
are necessary to prevent deception. For the same reason, the Commission
declines to make revisions addressing diamond-related issues such as
use of the terms ``blue white,'' ``ethical'' and ``conflict free,'' as
well as grading and appraisals. Furthermore, the final Guides do not
expand the guidance regarding ``handmade'' and similar terms
specifically to include or exclude hand-cast items because the
Commission lacks sufficient evidence on which to base new guidance.\22\
For the same reason, the Guides do not address whether marketers may
non-deceptively describe ``large-scale'' and ``mass'' or
``industrially'' produced jewelry as ``handmade.'' \23\
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\22\ The Commission does, however, add precious metal clays,
ingots, and casting grain to the ``raw materials'' listed in the
Note to this section (Section 23.2).
\23\ Additionally, the Commission declines to make changes
regarding the use of parts per thousand, instead of karats, for gold
content disclosures.
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Conclusion
For further analysis of comments and the final guidance, please see
the SBP on the FTC's website, available at https://www.ftc.gov/public-statements/2018/07/statement-basis-purpose-final-revisions-jewelry-guides.
List of Subjects in 16 CFR Part 23
Advertising, Jewelry, Labeling, Pewter, Precious metals, and Trade
practices.
0
For the reasons set forth in the preamble, the Federal Trade Commission
revises 16 CFR part 23 to read as follows:
PART 23--GUIDES FOR THE JEWELRY, PRECIOUS METALS, AND PEWTER
INDUSTRIES
Sec.
23.0 Scope and application.
23.1 Deception (general).
23.2 Misuse of the terms ``handmade,'' ``hand-polished,'' etc.
23.3 Misrepresentation as to gold content.
23.4 Misuse of the word ``vermeil.''
23.5 Misrepresentation as to silver content.
23.6 Misuse of the words ``platinum,'' ``iridium,'' ``palladium,''
``ruthenium,'' ``rhodium,'' and ``osmium.''
23.7 Disclosure of surface-layer application of rhodium.
23.8 Misrepresentation as to products containing more than one
precious metal.
23.9 Misrepresentation as to content of pewter.
23.10 Additional guidance for the use of quality marks.
23.11 Misuse of ``corrosion proof,'' ``non-corrosive,'' ``corrosion
resistant,'' ``rust proof,'' ``rust resistant,'' etc.
23.12 Definition and misuse of the word ``diamond.''
23.13 Misuse of the words ``flawless,'' ``perfect,'' etc.
23.14 Disclosure of treatments to diamonds.
23.15 Misuse of the term ``blue white.''
23.16 Misuse of the term ``properly cut,'' etc.
23.17 Misuse of the words ``brilliant'' and ``full cut.''
23.18 Misrepresentation of weight and ``total weight.''
23.19 Definitions of various pearls.
23.20 Misuse of the word ``pearl.''
23.21 Misuse of terms such as ``cultured pearl,'' ``seed pearl,''
``Oriental pearl,'' ``natura,'' ``kultured,'' ``real,'' ``gem,''
``synthetic,'' and regional designations.
23.22 Misrepresentation as to cultured pearls.
23.23 Disclosure of treatments to pearls and cultured pearls.
23.24 Disclosure of treatments to gemstones.
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23.25 Misuse of the words ``ruby,'' ``sapphire,'' ``emerald,''
``topaz,'' ``stone,'' ``birthstone,'' ``gemstone,'' etc.
23.26 Misrepresentation as to varietal name.
23.27 Misuse of the words ``real,'' ``genuine,'' ``natural,''
``precious,'' etc.
23.28 Misuse of the words ``flawless,'' ``perfect,'' etc.
Appendix to Part 23--Exemptions Recognized in the Assay for Quality
of Gold Alloy, Gold Filled, Gold Overlay, Rolled Gold Plate, Silver,
and Platinum Industry Products
Authority: 15 U.S.C. 45, 46.
Sec. 23.0 Scope and application.
(a) The guides in this part apply to jewelry industry products,
which include, but are not limited to, the following: Gemstones and
their laboratory-created and imitation substitutes; natural and
cultured pearls and their imitations; and metallic watch bands not
permanently attached to watches. These guides also apply to articles,
including optical frames, pens and pencils, flatware, and hollowware,
fabricated from precious metals (gold, silver, and platinum group
metals), precious metal alloys, and their imitations. These guides also
apply to all articles made from pewter. For the purposes of these
guides, all articles covered by these guides are defined as ``industry
products.''
(b) These guides apply to persons, partnerships, or corporations,
at every level of the trade (including but not limited to
manufacturers, suppliers, and retailers) engaged in the business of
offering for sale, selling, or distributing industry products.
Note to Paragraph (b): To prevent consumer deception, persons,
partnerships, or corporations in the business of appraising,
identifying, or grading industry products should utilize the
terminology and standards set forth in the guides.
(c) These guides apply to claims and representations about industry
products included in labeling, advertising, promotional materials, and
all other forms of marketing, whether asserted directly or by
implication, through words, symbols, emblems, logos, illustrations,
depictions, product brand names, or through any other means.
(d) These guides set forth the Federal Trade Commission's current
thinking about claims for jewelry and articles made from precious
metals and pewter. The guides help marketers and other industry members
avoid making claims that are unfair or deceptive under Section 5 of the
FTC Act, 15 U.S.C. 45. They do not confer any rights on any person and
do not operate to bind the FTC or the public. The Commission, however,
may take action under the FTC Act if a marketer or other industry
member makes a claim inconsistent with the guides. In any such
enforcement action, the Commission must prove that the challenged act
or practice is unfair or deceptive in violation of Section 5 of the FTC
Act.
(e) The guides consist of general principles, specific guidance on
the use of particular claims for industry products, and examples.
Claims may raise issues that are addressed by more than one example and
in more than one section of the guides. The examples provide the
Commission's views on how reasonable consumers likely interpret certain
claims. Industry members may use an alternative approach if the
approach satisfies the requirements of Section 5 of the FTC Act.
Whether a particular claim is deceptive will depend on the net
impression of the advertisement, label, or other promotional material
at issue. In addition, although many examples present specific claims
and options for qualifying claims, the examples do not illustrate all
permissible claims or qualifications under Section 5 of the FTC Act.
Sec. 23.1 Deception (general).
It is unfair or deceptive to misrepresent the type, kind, grade,
quality, quantity, metallic content, size, weight, cut, color,
character, treatment, substance, durability, serviceability, origin,
price, value, preparation, production, manufacture, distribution, or
any other material aspect of an industry product.
Note 1 to Sec. 23.1: If, in the sale or offering for sale of
an industry product, any representation is made as to the grade
assigned the product, the identity of the grading system used should
be disclosed.
Note 2 to Sec. 23.1: To prevent deception, any qualifications
or disclosures, such as those described in the guides, should be
sufficiently clear and prominent. Clarity of language, relative type
size and proximity to the claim being qualified, and an absence of
contrary claims that could undercut effectiveness, will maximize the
likelihood that the qualifications and disclosures are appropriately
clear and prominent.
Note 3 to Sec. 23.1: An illustration or depiction of a diamond
or other gemstone that portrays it in greater than its actual size
may mislead consumers, unless a disclosure is made about the item's
true size.
Sec. 23.2 Misuse of the terms ``handmade,'' ``hand-polished,'' etc.
(a) It is unfair or deceptive to represent, directly or by
implication, that any industry product is handmade or hand-wrought
unless the entire shaping and forming of such product from raw
materials and its finishing and decoration were accomplished by hand
labor and manually-controlled methods which permit the maker to control
and vary the construction, shape, design, and finish of each part of
each individual product.
Note to Paragraph (a): As used herein, ``raw materials''
include bulk sheet, strip, wire, precious metal clays, ingots,
casting grain, and similar items that have not been cut, shaped, or
formed into jewelry parts, semi-finished parts, or blanks.
(b) It is unfair or deceptive to represent, directly or by
implication, that any industry product is hand-forged, hand-engraved,
hand-finished, or hand-polished, or has been otherwise hand-processed,
unless the operation described was accomplished by hand labor and
manually-controlled methods which permit the maker to control and vary
the type, amount, and effect of such operation on each part of each
individual product.
Sec. 23.3 Misrepresentation as to gold content.
(a) It is unfair or deceptive to misrepresent the presence of gold
or gold alloy in an industry product, or the quantity or karat fineness
of gold or gold alloy contained in the product, or the karat fineness,
thickness, weight ratio, or manner of application of any gold or gold
alloy plating, covering, or coating on any surface of an industry
product or part thereof.
(b) The following are examples of markings or descriptions that may
be misleading: \24\
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\24\ See paragraph (c) of this section for examples of
acceptable markings and descriptions.
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(1) Use of the word ``Gold'' or any abbreviation, without
qualification, to describe all or part of an industry product,
including the surface layer of a coated product, which is not composed
throughout of fine (24 karat) gold.
(2) Use of the word ``Gold'' or any abbreviation to describe all or
part of an industry product (including the surface layer of a coated
product) composed throughout of an alloy of gold (i.e., gold that is
less than 24 karats), unless a correct designation of the karat
fineness of the alloy immediately precedes the word ``Gold'' or its
abbreviation, and such fineness designation is of at least equal
conspicuousness.
(3) Use of the word ``Gold'' or any abbreviation to describe all or
part of an industry product that is not composed throughout of gold or
a gold alloy, but is surface-plated or coated with gold alloy, unless
the word ``Gold'' or its abbreviation is adequately qualified to
[[Page 40669]]
indicate that the product or part is only surface-plated.
(4) Marking, describing, or otherwise representing all or part of
an industry product as being plated or coated with gold or gold alloy
unless all significant surfaces of the product or part contain a
plating or coating of gold or gold alloy that is of reasonable
durability.\25\
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\25\ For the purpose of this section, ``reasonable durability''
means that all areas of the plating are sufficiently thick to assure
coverage that reasonable consumers would expect from the surface
application. Since industry products include items having surfaces
and parts of surfaces that are subject to different degrees of wear,
the thickness of the surface application for all items or for
different areas of the surface of individual items does not
necessarily have to be uniform.
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(5) Use of the term ``Gold Plate,'' ``Gold Plated,'' or any
abbreviation to describe all or part of an industry product unless such
product or part contains a surface-plating of gold alloy, applied by
any process, which is of such thickness and extent of surface coverage
that reasonable durability \26\ is assured, and unless the term is
immediately preceded by a correct designation of the karat fineness of
the alloy that is of at least equal conspicuousness as the term used.
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\26\ See footnote 2.
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(6) Use of the terms ``Gold Filled,'' ``Rolled Gold Plate,''
``Rolled Gold Plated,'' ``Gold Overlay,'' or any abbreviation to
describe all or part of an industry product unless such product or part
contains a surface-plating of gold alloy applied by a mechanical
process and of such thickness and extent of surface coverage that
reasonable durability \27\ is assured, and unless the term is
immediately preceded by a correct designation of the karat fineness of
the alloy that is of at least equal conspicuousness as the term used.
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\27\ See footnote 2.
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(7) Use of the terms ``Gold Plate,'' ``Gold Plated,'' ``Gold
Filled,'' ``Rolled Gold Plate,'' ``Rolled Gold Plated,'' ``Gold
Overlay,'' or any abbreviation to describe a product in which the layer
of gold plating has been covered with a base metal (such as nickel),
which is covered with a thin wash of gold, unless there is a disclosure
that the primary gold coating is covered with a base metal, which is
gold washed.
(8) Use of the term ``Gold Electroplate,'' ``Gold Electroplated,''
or any abbreviation to describe all or part of an industry product
unless such product or part is electroplated with gold or a gold alloy
and such electroplating is of such karat fineness, thickness, and
extent of surface coverage that reasonable durability \28\ is assured,
and unless the term is immediately preceded by a correct designation of
the karat fineness of the alloy that is of at least equal
conspicuousness as the term used.
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\28\ See footnote 2.
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(9) Use of any name, terminology, or other term to misrepresent
that an industry product is equal or superior to, or different than, a
known and established type of industry product with reference to its
gold content or method of manufacture.
(c) The following are examples of markings and descriptions that
are consistent with the principles described above:
(1) An industry product or part thereof, composed throughout of an
alloy of gold may be marked and described as ``Gold'' when such word
``Gold,'' wherever appearing, is immediately preceded by a correct
designation of the karat fineness of the alloy, and such karat
designation is of equal conspicuousness as the word ``Gold'' (for
example, ``14 Karat Gold,'' ``14 K. Gold,'' ``14 Kt. Gold,'' ``9 Karat
Gold,'' or ``9 Kt. Gold''). Such product may also be marked and
described by a designation of the karat fineness of the gold alloy
unaccompanied by the word ``Gold'' (for example, ``14 Karat,''
``14Kt.,'' ``14 K.,'' or ``9 K.'').
Note to Paragraph (c)(1): Use of the term ``Gold'' or any
abbreviation to describe all or part of a product that is composed
throughout of gold alloy, but contains a hollow center or interior,
may mislead consumers, unless the fact that the product contains a
hollow center is disclosed in immediate proximity to the term
``Gold'' or its abbreviation (for example, ``14 Karat Gold-Hollow
Center,'' or ``14 K. Gold Tubing,'' when of a gold alloy tubing of
such karat fineness). Such products should not be marked or
described as ``solid'' or as being solidly of gold or of a gold
alloy. For example, when the composition of such a product is 14
karat gold alloy, it should not be described or marked as either
``14 Kt. Solid Gold'' or as ``Solid 14 Kt. Gold.''
(2) An industry product or part thereof on which there has been
affixed on all significant surfaces by soldering, brazing, welding, or
other mechanical means a plating of gold alloy of not less than 10
karat fineness and of reasonable durability \29\ may be marked or
described as ``Gold Plate,'' ``Gold Plated,'' ``Gold Overlay,''
``Rolled Gold Plate,'' ``Rolled Gold Plated,'' or an adequate
abbreviation, when such plating constitutes at least 1/40th of the
weight of the metal in the entire article and when the term is
immediately preceded by a designation of the karat fineness of the
plating which is of equal conspicuousness as the term used (for
example, ``14 Kt. Gold Overlay,'' or ``14K. R.G.P.''). When such
plating constitutes at least 1/20th of the weight of the metal in the
entire article, the term ``Gold Filled'' may be used. The terms ``Gold
Overlay,'' ``Rolled Gold Plate,'' and ``Rolled Gold Plated'' may be
used when the karat fineness designation is immediately preceded by a
fraction accurately disclosing the portion of the weight of the metal
in the entire article accounted for by the plating, and when such
fraction is of equal conspicuousness as the term used (for example,
``1/40th 12 Kt. Rolled Gold Plate'' or ``1/40 12 Kt. R.G.P.'').
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\29\ See footnote 2.
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(3) An industry product or part thereof on which there has been
affixed on all significant surfaces by an electrolytic process an
electroplating of gold, or of a gold alloy of not less than 10 karat
fineness, which is of reasonable durability \30\ and has a minimum
thickness throughout equivalent to 0.175 microns (approximately 7/
1,000,000ths of an inch) of fine gold,\31\ may be marked or described
as ``Gold Plate,'' ``Gold Plated,'' ``Gold Electroplate'' or ``Gold
Electroplated,'' or so abbreviated, if the term is immediately preceded
by a designation of the karat fineness of the plating which is of equal
conspicuousness as the term used (e.g., ``12 Karat Gold Electroplate''
or ``12K G.E.P.''). When the electroplating is of the minimum fineness
specified above and of a minimum thickness throughout equivalent to two
and one half (2\1/2\) microns (or approximately 100/1,000,000ths of an
inch) of fine gold, the marking or description may be ``Heavy Gold
Electroplate'' or ``Heavy Gold Electroplated.'' When electroplatings
qualify for the term ``Gold Electroplate'' (or ``Gold Electroplated''),
or the term ``Heavy Gold Electroplate'' (or ``Heavy Gold
Electroplated''), and have been applied by use of a particular kind of
electrolytic process, the marking may be accompanied by identification
of the process used, as for example, ``Gold Electroplated (X Process)''
or ``Heavy Gold Electroplated (Y Process).''
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\30\ See footnote 2.
\31\ A product containing 1 micron (otherwise known as 1[mu]) of
12 karat gold is equivalent to one-half micron of 24-karat gold.
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(d) The provisions of this section relating to markings and
descriptions of industry products and parts thereof are subject to the
applicable tolerances of the National Stamping Act or any amendment
thereof.\32\
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\32\ Under the National Stamping Act, articles or parts made of
gold or of gold alloy that contain no solder have a permissible
tolerance of three parts per thousand. If the part tested contains
solder, the permissible tolerance is seven parts per thousand. For
full text, see 15 U.S.C. 295, et seq.
[[Page 40670]]
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Note to Paragraph (d): Exemptions recognized in the assay of
karat gold industry products and in the assay of gold filled, gold
overlay, and rolled gold plate industry products, and not to be
considered in any assay for quality, are listed in the appendix.
Sec. 23.4 Misuse of the word ``vermeil.''
(a) It is unfair or deceptive to represent, directly or by
implication, that an industry product is ``vermeil'' if such mark or
description misrepresents the product's true composition.
(b) An industry product may be described or marked as ``vermeil''
if it consists of a base of sterling silver coated or plated on all
significant surfaces with gold, or gold alloy of not less than 10 karat
fineness, that is of reasonable durability \33\ and a minimum thickness
throughout equivalent to two and one half (2\1/2\) microns (or
approximately 100/1,000,000ths of an inch) of fine gold.
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\33\ See footnote 2.
Note 1 to Sec. 23.4: It is unfair or deceptive to use the term
``vermeil'' to describe a product in which the sterling silver has
been covered with a base metal (such as nickel) plated with gold
unless there is a disclosure that the sterling silver is covered
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with a base metal that is plated with gold.
Note 2 to Sec. 23.4: Exemptions recognized in the assay of gold
filled, gold overlay, and rolled gold plate industry products are
listed in the appendix.
Sec. 23.5 Misrepresentation as to silver content.
(a) It is unfair or deceptive to misrepresent that an industry
product contains silver, or to misrepresent an industry product as
having a silver content, plating, electroplating, or coating.
(b) The following are examples of markings or descriptions that may
be misleading:
(1) Use of the unqualified word ``silver'' to mark, describe, or
otherwise represent all or part of an industry product, including the
surface layer of a coated product, unless an equally conspicuous,
accurate quality fineness designation indicating the pure silver
content in parts per thousand immediately precedes the term (e.g.,
``750 silver'').
(2) Use of the words ``solid silver,'' ``Sterling Silver,''
``Sterling,'' or the abbreviation ``Ster.'' to mark, describe, or
otherwise represent all or part of an industry product unless it is at
least 925/1,000ths pure silver.
(3) Use of the words ``coin'' or ``coin silver'' to mark, describe,
or otherwise represent all or part of an industry product unless it is
at least 900/1,000ths pure silver.
(4) Use of the word ``silver'' to mark, describe, or otherwise
represent all or part of an industry product that is not composed
throughout of silver, but has a surface layer or coating of silver,
unless the term is adequately qualified to indicate that the product or
part is only coated.
(5) Marking, describing, or otherwise representing all or part of
an industry product as being plated or coated with silver unless all
significant surfaces of the product or part contain a plating or
coating of silver that is of reasonable durability.\34\
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\34\ See footnote 2.
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(c) The provisions of this section relating to markings and
descriptions of industry products and parts thereof are subject to the
applicable tolerances of the National Stamping Act or any amendment
thereof.\35\
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\35\ Under the National Stamping Act, sterling silver articles
or parts that contain no solder have a permissible tolerance of four
parts per thousand. If the part tested contains solder, the
permissible tolerance is ten parts per thousand. For full text, see
15 U.S.C. 294, et seq.
Note 1 to Sec. 23.5: The National Stamping Act provides that
silver plated articles shall not ``be stamped, branded, engraved or
imprinted with the word `sterling' or the word `coin,' either alone
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or in conjunction with other words or marks.'' 15 U.S.C. 297(a).
Note 2 to Sec. 23.5: Exemptions recognized in the assay of
silver industry products are listed in the appendix.
Sec. 23.6 Misuse of the words ``platinum,'' ``iridium,''
``palladium,'' ``ruthenium,'' ``rhodium,'' and ``osmium.''
(a) It is unfair or deceptive to use the words ``platinum,''
``iridium,'' ``palladium,'' ``ruthenium,'' ``rhodium,'' and ``osmium,''
or any abbreviation to mark or describe all or part of an industry
product if such marking or description misrepresents the product's true
composition. The Platinum Group Metals (PGM) are Platinum, Iridium,
Palladium, Ruthenium, Rhodium, and Osmium.
(b) The following are examples of markings or descriptions that may
be misleading: \36\
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\36\ See paragraph (c) of this section for examples of
acceptable markings and descriptions.
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(1) Use of the word ``Platinum'' or any abbreviation to describe
all or part of a product that is not composed throughout of platinum,
but has a surface layer or coating of platinum, unless the word
``Platinum'' or its abbreviation is adequately qualified to indicate
that the product or part is only coated.
(2) Marking, describing, or otherwise representing all or part of
an industry product as being plated or coated with platinum unless all
significant surfaces of the product or part contain a plating or
coating of platinum that is of reasonable durability.\37\
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\37\ See footnote 2.
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(3) Use of the word ``Platinum'' or any abbreviation, without
qualification, to describe all or part of an industry product
(including the surface layer of a coated product) that is not composed
throughout of 950 parts per thousand pure Platinum.
(4) Use of the word ``Platinum'' or any abbreviation accompanied by
a number indicating the parts per thousand of pure Platinum contained
in the product without mention of the number of parts per thousand of
other PGM contained in the product, to describe all or part of an
industry product that is not composed throughout of at least 850 parts
per thousand pure platinum, for example, ``600Plat.''
(5) Use of the word ``Platinum'' or any abbreviation thereof, to
mark or describe any product that is not composed throughout of at
least 500 parts per thousand pure Platinum.
(6) Use of the word ``Platinum,'' or any abbreviation accompanied
by a number or percentage indicating the parts per thousand of pure
Platinum contained in the product, to describe all or part of an
industry product that contains at least 500 parts per thousand, but
less than 850 parts per thousand, pure Platinum, and does not contain
at least 950 parts per thousand PGM (for example, ``585 Plat.'')
without a clear and conspicuous disclosure, immediately following the
name or description of such product:
(i) Of the full composition of the product (by name and not
abbreviation) and percentage of each metal; and
(ii) That the product may not have the same attributes or
properties as traditional platinum products. Provided, however, that
the marketer need not make disclosure under this paragraph (b)(6)(ii),
if the marketer has competent and reliable scientific evidence that
such product does not differ materially from any one product containing
at least 850 parts per thousand pure Platinum with respect to the
following attributes or properties: Durability, luster, density,
scratch resistance, tarnish resistance, hypoallergenicity, ability to
be resized or repaired, retention of precious metal over time, and any
other attribute or property material to consumers.
Note to Paragraph (b)(6): When using percentages to qualify
platinum representations, marketers should convert the
[[Page 40671]]
amount in parts per thousand to a percentage that is accurate to the
first decimal place (e.g., ``58.5% Platinum, 41.5% Cobalt'').
(c) The following are examples of markings and descriptions that
are not considered unfair or deceptive:
(1) The following abbreviations for each of the PGM may be used for
quality marks on articles: ``Plat.'' or ``Pt.'' for Platinum; ``Irid.''
or ``Ir.'' for Iridium; ``Pall.'' or ``Pd.'' for Palladium; ``Ruth.''
or ``Ru.'' for Ruthenium; ``Rhod.'' or ``Rh.'' for Rhodium; and
``Osmi.'' or ``Os.'' for Osmium.
(2) An industry product consisting of at least 950 parts per
thousand pure Platinum may be marked or described as ``Platinum.''
(3) An industry product consisting of 850 parts per thousand pure
Platinum, 900 parts per thousand pure Platinum, or 950 parts per
thousand pure Platinum may be marked ``Platinum,'' provided that the
Platinum marking is preceded by a number indicating the amount in parts
per thousand of pure Platinum (for industry products consisting of 950
parts per thousand pure Platinum, the marking described in Sec.
23.7(b)(2) above is also appropriate). Thus, the following markings may
be used: ``950Pt.,'' ``950Plat.,'' ``900Pt.,'' ``900Plat.,''
``850Pt.,'' or ``850Plat.''
(4) An industry product consisting of at least 950 parts per
thousand PGM, and of at least 500 parts per thousand pure Platinum, may
be marked ``Platinum,'' provided that the mark of each PGM constituent
is preceded by a number indicating the amount in parts per thousand of
each PGM (e.g., ``600Pt.350Ir.,'' ``600Plat.350Irid.,''
``550Pt.350Pd.50Ir.,'' or ``550Plat.350Pall.50Irid'').
(5) An industry product consisting of at least 500 parts per
thousand, but less than 850 parts per thousand, pure Platinum, and not
consisting of at least 950 parts per thousand PGM, may be marked or
stamped accurately, with a quality marking on the article, using parts
per thousand and standard chemical abbreviations (e.g., ``585 Pt., 415
Co.'').
Note to Sec. 23.6: Exemptions recognized in the assay of
platinum industry products are listed in the appendix.
Sec. 23.7 Disclosure of surface-layer application of rhodium.
It is unfair or deceptive to fail to disclose a surface-layer
application of rhodium on products marked or described as precious
metal.
Sec. 23.8 Misrepresentation as to products containing more than one
precious metal.
(a) It is unfair or deceptive to misrepresent the relative quantity
of each precious metal in a product that contains more than than one
precious metal. Marketers should list precious metals in the order of
their relative weight in the product from greatest to least (i.e.,
leading with the predominant metal). Listing precious metals in order
of relative weight is not necessary where it is clear to reasonable
consumers from context that the metal listed first is not predominant.
(b) The following are examples of markings or descriptions that may
be misleading:
(1) Use of the terms ``Platinum + Silver'' to describe a product
that contains more silver than platinum by weight.
(2) Use of the terms ``14K/Sterling'' to describe a product that
contains more silver than gold by weight.
(c) The following are examples of markings and descriptions that
are not considered unfair or deceptive:
(1) For a product comprised primarily of silver with a surface-
layer application of platinum, ``900 platinum over silver.''
(2) For a product comprised primarily of silver with visually
distinguishable parts of gold, ``14k gold-accented silver.''
(3) For a product comprised primarily of gold with visually
distinguishable parts of platinum, ``850 Platinum inset, 14K gold
ring.''
Sec. 23.9 Misrepresentation as to content of pewter.
(a) It is unfair or deceptive to mark, describe, or otherwise
represent all or part of an industry product as ``Pewter'' or any
abbreviation if such mark or description misrepresents the product's
true composition.
(b) An industry product or part thereof may be described or marked
as ``Pewter'' or any abbreviation if it consists of at least 900 parts
per 1,000 Grade A Tin, with the remainder composed of metals
appropriate for use in pewter.
Sec. 23.10 Additional guidance for the use of quality marks.
As used in these guides, the term quality mark means any letter,
figure, numeral, symbol, sign, word, or term, or any combination
thereof, that has been stamped, embossed, inscribed, or otherwise
placed on any industry product and which indicates or suggests that any
such product is composed throughout of any precious metal or any
precious metal alloy or has a surface or surfaces on which there has
been plated or deposited any precious metal or precious metal alloy.
Included are the words ``gold,'' ``karat,'' ``carat,'' ``silver,''
``sterling,'' ``vermeil,'' ``platinum,'' ``iridium,'' ``palladium,''
``ruthenium,'' ``rhodium,'' or ``osmium,'' or any abbreviations
thereof, whether used alone or in conjunction with the words
``filled,'' ``plated,'' ``overlay,'' or ``electroplated,'' or any
abbreviations thereof. Quality markings include those in which the
words or terms ``gold,'' ``karat,'' ``silver,'' ``vermeil,''
``platinum'' (or platinum group metals), or their abbreviations are
included, either separately or as suffixes, prefixes, or syllables.
(a) Deception as to applicability of marks. (1) If a quality mark
on an industry product is applicable to only part of the product, the
part of the product to which it is applicable (or inapplicable) should
be disclosed when, absent such disclosure, the location of the mark
misrepresents the product or part's true composition.
(2) If a quality mark is applicable to only part of an industry
product, but not another part which is of similar surface appearance,
each quality mark should be closely accompanied by an identification of
the part or parts to which the mark is applicable.
(b) Deception by reason of difference in the size of letters or
words in a marking or markings. It is unfair or deceptive to place a
quality mark on a product in which the words or letters appear in
greater size than other words or letters of the mark, or when different
markings placed on the product have different applications and are in
different sizes, when the net impression of any such marking would be
misleading as to the metallic composition of all or part of the
product. (An example of improper marking would be the marking of a gold
electroplated product with the word ``electroplate'' in small type and
the word ``gold'' in larger type, with the result that purchasers and
prospective purchasers of the product might only observe the word
``gold.'')
Note 1 to Sec. 23.10: Legibility of markings. If a quality mark
is engraved or stamped on an industry product, or is printed on a
tag or label attached to the product, the quality mark should be of
sufficient size type as to be legible to persons of normal vision,
should be so placed as likely to be observed by purchasers, and
should be so attached as to remain thereon until consumer purchase.
Note 2 to Sec. 23.10: Disclosure of identity of manufacturers,
processors, or distributors. The National Stamping Act provides that
any person, firm, corporation, or association, being a manufacturer
or dealer subject to section 294 of the Act, who applies or causes
to be applied a quality mark, or imports any article bearing a
quality mark ``which indicates or purports to indicate that such
article is made in whole or in part of gold
[[Page 40672]]
or silver or of an alloy of either metal'' shall apply to the
article the trademark or name of such person. 15 U.S.C. 297.
Sec. 23.11 Misuse of ``corrosion proof,'' ``noncorrosive,''
``corrosion resistant,'' ``rust proof,'' ``rust resistant,'' etc.
(a) It is unfair or deceptive to:
(1) Use the terms ``corrosion proof,'' ``noncorrosive,'' ``rust
proof,'' or any other term of similar meaning to describe an industry
product unless all parts of the product will be immune from rust and
other forms of corrosion during the life expectancy of the product; or
(2) Use the terms ``corrosion resistant,'' ``rust resistant,'' or
any other term of similar meaning to describe an industry product
unless all parts of the product are of such composition as to not be
subject to material damage by corrosion or rust during the major
portion of the life expectancy of the product under normal conditions
of use.
(b) Among the metals that may be considered as corrosion (and rust)
resistant are: Pure nickel; gold alloys of not less than 10 Kt.
fineness; and austenitic stainless steels.
Sec. 23.12 Definition and misuse of the word ``diamond.''
(a) A diamond is a mineral consisting essentially of pure carbon
crystallized in the isometric system. It is found in many colors. Its
hardness is 10; its specific gravity is approximately 3.52; and it has
a refractive index of 2.42.
(b) It is unfair or deceptive to use the unqualified word
``diamond'' to describe or identify any object or product not meeting
the requirements specified in the definition of diamond provided above,
or which, though meeting such requirements, has not been symmetrically
fashioned with at least seventeen (17) polished facets.
Note to Paragraph (b): It is unfair or deceptive to represent,
directly or by implication, that industrial grade diamonds or other
non-jewelry quality diamonds are of jewelry quality.
(c) The following are examples of descriptions that are not
considered unfair or deceptive:
(1) The use of the words ``rough diamond'' to describe or designate
uncut or unfaceted objects or products satisfying the definition of
diamond provided above; or
(2) The use of the word ``diamond'' to describe or designate
objects or products satisfying the definition of diamond but which have
not been symmetrically fashioned with at least seventeen (17) polished
facets when, in immediate conjunction with the word ``diamond,'' there
is either a disclosure of the number of facets and shape of the diamond
or the name of a type of diamond that denotes shape and that usually
has less than seventeen (17) facets (e.g., ``rose diamond'').
(3) The use of the word ``cultured'' to describe laboratory-created
diamonds that have essentially the same optical, physical, and chemical
properties as mined diamonds if the term is qualified by a clear and
conspicuous disclosure (for example, the words ``laboratory-created,''
``laboratory-grown,'' ``[manufacturer name]-created,'' or some other
word or phrase of like meaning) conveying that the product is not a
mined stone.
Note to Paragraph (c): Additional guidance about imitation and
laboratory-created diamond representations and misuse of the words
``real,'' ``genuine,'' ``natural,'' ``precious,'' ``semi-precious,''
and similar terms is set forth in Sec. Sec. 23.25 and 23.27.
Sec. 23.13 Misuse of the words ``flawless,'' ``perfect,'' etc.
(a) It is unfair or deceptive to use the word ``flawless'' to
describe any diamond that discloses flaws, cracks, inclusions, carbon
spots, clouds, internal lasering, or other blemishes or imperfections
of any sort when examined under a corrected magnifier at 10-power, with
adequate illumination, by a person skilled in diamond grading.
(b) It is unfair or deceptive to use the word ``perfect,'' or any
representation of similar meaning, to describe any diamond unless the
diamond meets the definition of ``flawless'' and is not of inferior
color or make.
(c) It is unfair or deceptive to use the words ``flawless'' or
``perfect'' to describe a ring or other article of jewelry having a
``flawless'' or ``perfect'' principal diamond or diamonds, and
supplementary stones that are not of such quality, unless there is a
disclosure that the description applies only to the principal diamond
or diamonds.
Sec. 23.14 Disclosure of treatments to diamonds.
A diamond is a gemstone product. Treatments to diamonds should be
disclosed in the manner prescribed in Sec. 23.24 of these guides
(Disclosure of treatments to gemstones).
Sec. 23.15 Misuse of the term ``blue white.''
It is unfair or deceptive to use the term ``blue white'' or any
representation of similar meaning to describe any diamond that under
normal, north daylight or its equivalent shows any color or any trace
of any color other than blue or bluish.
Sec. 23.16 Misuse of the term ``properly cut,'' etc.
It is unfair or deceptive to use the terms ``properly cut,''
``proper cut,'' ``modern cut,'' or any representation of similar
meaning to describe any diamond that is lopsided, or is so thick or so
thin in depth as to detract materially from the brilliance of the
stone.
Note to Sec. 23.16: Stones that are commonly called ``fisheye''
or ``old mine'' should not be described as ``properly cut,''
``modern cut,'' etc.
Sec. 23.17 Misuse of the words ``brilliant'' and ``full cut.''
It is unfair or deceptive to use the unqualified expressions
``brilliant,'' ``brilliant cut,'' or ``full cut'' to describe,
identify, or refer to any diamond except a round diamond that has at
least thirty-two (32) facets plus the table above the girdle and at
least twenty-four (24) facets below.
Note to Sec. 23.17: Such terms should not be applied to single
or rose-cut diamonds. They may be applied to emerald-(rectangular)
cut, pear-shaped, heart-shaped, oval-shaped, and marquise-(pointed
oval) cut diamonds meeting the above-stated facet requirements when,
in immediate conjunction with the term used, the form of the diamond
is disclosed.
Sec. 23.18 Misrepresentation of weight and ``total weight.''
(a) It is unfair or deceptive to misrepresent the weight of a
diamond.
(b) It is unfair or deceptive to use the word ``point'' or any
abbreviation in any representation, advertising, marking, or labeling
to describe the weight of a diamond, unless the weight is also stated
as decimal parts of a carat (e.g., 25 points or .25 carat).
Note to Paragraph (b): A carat is a standard unit of weight for
a diamond and is equivalent to 200 milligrams (\1/5\ gram). A point
is one one-hundredth (1/100) of a carat.
(c) If diamond weight is stated as decimal parts of a carat (e.g.,
.47 carat), the stated figure should be accurate to the last decimal
place. If diamond weight is stated to only one decimal place (e.g., .5
carat), the stated figure should be accurate to the second decimal
place (e.g., ``.5 carat'' could represent a diamond weight between
.495-.504).
(d) If diamond weight is stated as fractional parts of a carat, a
conspicuous disclosure of the fact that the diamond weight is not exact
should be made in close proximity to the fractional representation and
a disclosure of a reasonable range of weight for each fraction (or the
weight tolerance being used) should also be made.
[[Page 40673]]
Note to Paragraph (d): When fractional representations of
diamond weight are made, as described in paragraph (d) of this
section, in catalogs or other printed materials, the disclosure of
the fact that the actual diamond weight is within a specified range
should be made conspicuously on every page where a fractional
representation is made. Such disclosure may refer to a chart or
other detailed explanation of the actual ranges used. For example,
``Diamond weights are not exact; see chart on p. X for ranges.''
Sec. 23.19 Definitions of various pearls.
As used in these guides, the terms set forth below have the
following meanings:
(a) Pearl: A calcareous concretion consisting essentially of
alternating concentric layers of carbonate of lime and organic material
formed within the body of certain mollusks, the result of an abnormal
secretory process caused by an irritation of the mantle of the mollusk
following the intrusion of some foreign body inside the shell of the
mollusk, or due to some abnormal physiological condition in the
mollusk, neither of which has in any way been caused or induced by
humans.
(b) Cultured pearl: The composite product created when a nucleus
(usually a sphere of calcareous mollusk shell) planted by humans inside
the shell or in the mantle of a mollusk is coated with nacre by the
mollusk.
(c) Imitation pearl: A manufactured product composed of any
material or materials that simulate in appearance a pearl or cultured
pearl.
(d) Seed pearl: A small pearl, as defined in paragraph (a), that
measures approximately two millimeters or less.
Sec. 23.20 Misuse of the word ``pearl.''
(a) It is unfair or deceptive to use the unqualified word ``pearl''
or any other word or phrase of like meaning to describe, identify, or
refer to any object or product that is not in fact a pearl, as defined
in Sec. 23.19(a).
(b) It is unfair or deceptive to use the word ``pearl'' to
describe, identify, or refer to a cultured pearl unless it is
immediately preceded, with equal conspicuousness, by the word
``cultured'' or ``cultivated,'' or by some other word or phrase of like
meaning, so as to indicate definitely and clearly that the product is
not a pearl.
(c) It is unfair or deceptive to use the word ``pearl'' to
describe, identify, or refer to an imitation pearl unless it is
immediately preceded, with equal conspicuousness, by the word
``artificial,'' ``imitation,'' or ``simulated,'' or by some other word
or phrase of like meaning, so as to indicate definitely and clearly
that the product is not a pearl.
(d) It is unfair or deceptive to use the terms ``faux pearl,''
``fashion pearl,'' ``Mother of Pearl,'' or any other such term to
describe or qualify an imitation pearl product unless it is immediately
preceded, with equal conspicuousness, by the word ``artificial,''
``imitation,'' or ``simulated,'' or by some other word or phrase of
like meaning, so as to indicate definitely and clearly that the product
is not a pearl.
Sec. 23.21 Misuse of terms such as ``cultured pearl,'' ``seed
pearl,'' ``Oriental pearl,'' ``natura,'' ``kultured,'' ``real,''
``synthetic,'' and regional designations.
(a) It is unfair or deceptive to use the term ``cultured pearl,''
``cultivated pearl,'' or any other word, term, or phrase of like
meaning to describe, identify, or refer to any imitation pearl.
(b) It is unfair or deceptive to use the term ``seed pearl'' or any
word, term, or phrase of like meaning to describe, identify, or refer
to a cultured or an imitation pearl, without using the appropriate
qualifying term ``cultured'' (e.g., ``cultured seed pearl'') or
``simulated,'' ``artificial,'' or ``imitation'' (e.g., ``imitation seed
pearl'').
(c) It is unfair or deceptive to use the term ``Oriental pearl'' or
any word, term, or phrase of like meaning to describe, identify, or
refer to any industry product other than a pearl taken from a salt
water mollusk and of the distinctive appearance and type of pearls
obtained from mollusks inhabiting the Persian Gulf and recognized in
the jewelry trade as Oriental pearls.
(d) It is unfair or deceptive to use the word ``Oriental'' to
describe, identify, or refer to any cultured or imitation pearl.
(e) It is unfair or deceptive to use the word ``natura,''
``natural,'' ``nature's,'' or any word, term, or phrase of like meaning
to describe, identify, or refer to a cultured or imitation pearl. It is
unfair or deceptive to use the term ``organic'' to describe, identify,
or refer to an imitation pearl, unless the term is qualified in such a
way as to make clear that the product is not a natural or cultured
pearl.
(f) It is unfair or deceptive to use the term ``kultured,'' ``semi-
cultured pearl,'' ``cultured-like,'' ``part-cultured,'' ``premature
cultured pearl,'' or any word, term, or phrase of like meaning to
describe, identify, or refer to an imitation pearl.
(g) It is unfair or deceptive to use the term ``South Sea pearl''
unless it describes, identifies, or refers to a pearl that is taken
from a salt water mollusk of the Pacific Ocean South Sea Islands,
Australia, or Southeast Asia. It is unfair or deceptive to use the term
``South Sea cultured pearl'' unless it describes, identifies, or refers
to a cultured pearl formed in a salt water mollusk of the Pacific Ocean
South Sea Islands, Australia, or Southeast Asia.
(h) It is unfair or deceptive to use the term ``Biwa cultured
pearl'' unless it describes, identifies, or refers to cultured pearls
grown in fresh water mollusks in the lakes and rivers of Japan.
(i) It is unfair or deceptive to use the word ``real,''
``genuine,'' ``precious,'' or any word, term, or phrase of like meaning
to describe, identify, or refer to any imitation pearl.
(j) It is unfair or deceptive to use the word ``synthetic'' or
similar terms to describe cultured or imitation pearls.
(k) It is unfair or deceptive to use the terms ``Japanese Pearls,''
``Chinese Pearls,'' ``Mallorca Pearls,'' or any regional designation to
describe, identify, or refer to any cultured or imitation pearl, unless
the term is immediately preceded, with equal conspicuousness, by the
word ``cultured,'' ``artificial,'' ``imitation,'' or ``simulated,'' or
by some other word or phrase of like meaning, so as to indicate
definitely and clearly that the product is a cultured or imitation
pearl.
Sec. 23.22 Misrepresentation as to cultured pearls.
It is unfair or deceptive to misrepresent the manner in which
cultured pearls are produced, the size of the nucleus artificially
inserted in the mollusk and included in cultured pearls, the length of
time that such products remained in the mollusk, the thickness of the
nacre coating, the value and quality of cultured pearls as compared
with the value and quality of pearls and imitation pearls, or any other
material matter relating to the formation, structure, properties,
characteristics, and qualities of cultured pearls.
Sec. 23.23 Disclosure of treatments to pearls and cultured pearls.
It is unfair or deceptive to fail to disclose that a pearl or
cultured pearl has been treated if:
(a) The treatment is not permanent. The seller should disclose that
the pearl or cultured pearl has been treated and that the treatment is
or may not be permanent;
(b) The treatment creates special care requirements for the pearl
or cultured pearl. The seller should disclose that the pearl or
cultured pearl has been treated and has special care requirements. It
is also recommended that the seller disclose the special care
requirements to the purchaser; or
(c) The treatment has a significant effect on the product's value.
The seller
[[Page 40674]]
should disclose that the pearl or cultured pearl has been treated.
Note to Sec. 23.23: The disclosures outlined in this section
are applicable to sellers at every level of trade, as defined in
Sec. 23.0(b) of these guides, and they may be made at the point of
sale prior to sale, except that where a product can be purchased
without personally viewing the product (e.g., direct mail catalogs,
online services, televised shopping programs), disclosure should be
made in the solicitation for, or description of, the product.
Sec. 23.24 Disclosure of treatments to gemstones.
It is unfair or deceptive to fail to disclose that a gemstone has
been treated if:
(a) The treatment is not permanent. The seller should disclose that
the gemstone has been treated and that the treatment is or may not be
permanent;
(b) The treatment creates special care requirements for the
gemstone. The seller should disclose that the gemstone has been treated
and has special care requirements. It is also recommended that the
seller disclose the special care requirements to the purchaser; or
(c) The treatment has a significant effect on the stone's value.
The seller should disclose that the gemstone has been treated.
Note to Sec. 23.24: The disclosures outlined in this section
are applicable to sellers at every level of trade, as defined in
Sec. 23.0(b) of these guides, and they may be made at the point of
sale prior to sale, except that where a product can be purchased
without personally viewing the product (e.g., direct mail catalogs,
online services, televised shopping programs), disclosure should be
made in the solicitation for, or description of, the product.
Sec. 23.25 Misuse of the words ``ruby,'' ``sapphire,'' ``emerald,''
``topaz,'' ``stone,'' ``birthstone,'' ``gem,'' ``gemstone,'' etc.
(a) It is unfair or deceptive to use the unqualified words
``ruby,'' ``sapphire,'' ``emerald,'' ``topaz,'' or the name of any
other precious or semi-precious stone to describe any product that is
not in fact a mined stone of the type described.
(b) It is unfair or deceptive to use the word ``ruby,''
``sapphire,'' ``emerald,'' ``topaz,'' or the name of any other precious
or semi-precious stone, or the word ``stone,'' ``birthstone,'' ``gem,''
``gemstone,'' or similar term to describe a laboratory-grown,
laboratory-created, [manufacturer name]-created, synthetic, imitation,
or simulated stone, unless such word or name is immediately preceded
with equal conspicuousness by the word ``laboratory-grown,''
``laboratory-created,'' ``[manufacturer name]-created,'' or some other
word or phrase of like meaning, or by the word ``imitation'' or
``simulated,'' so as to disclose clearly the nature of the product and
the fact it is not a mined gemstone.
Note 1 to Paragraph (b): The use of the word ``faux'' to
describe a laboratory-created or imitation stone is not an adequate
disclosure that the stone is not a mined stone.
Note 2 to Paragraph (b): Marketers may use the word ``cultured''
to describe laboratory-created gemstone products that have
essentially the same optical, physical, and chemical properties as
the named stone if the term (e.g., ``cultured ruby'') is qualified
by a clear and conspicuous disclosure (for example, the words
``laboratory-created,'' ``laboratory-grown,'' ``[manufacturer name]-
created,'' or some other word or phrase of like meaning) conveying
that the product is not a mined stone. Additional guidance regarding
the use of ``cultured'' to describe a laboratory-created diamond is
set forth in Sec. 23.12(c)(3).
(c) It is unfair or deceptive to use the word ``laboratory-grown,''
``laboratory-created,'' ``[manufacturer name]-created,'' ``synthetic,''
or other word or phrase of like meaning with the name of any natural
stone to describe any industry product unless such product has
essentially the same optical, physical, and chemical properties as the
stone named.
(d) It is unfair or deceptive to describe products made with
gemstone material and any amount of filler or binder, such as lead
glass, in the following way:
(1) With the unqualified word ``ruby,'' ``sapphire,'' ``emerald,''
``topaz,'' or name of any other precious or semi-precious stone;
(2) As a ``treated ruby,'' ``treated sapphire,'' ``treated
emerald,'' ``treated topaz,'' or ``treated [gemstone name]'';
(3) As a ``laboratory-grown [gemstone name],'' ``laboratory-created
[gemstone name],'' ``[manufacturer name]-created [gemstone name],''
``or ``synthetic [gemstone name];'' or
(4) As a ``composite [gemstone name],'' ``hybrid [gemstone name],''
or ``manufactured [gemstone name],'' unless the term is qualified to
disclose clearly and conspicuously that the product: (A) Does not have
the same characteristics as the named stone; and (B) requires special
care. It is further recommended that the seller disclose the special
care requirements to the purchaser.
Sec. 23.26 Misrepresentation as to varietal name.
(a) It is unfair or deceptive to mark or describe an industry
product with the incorrect varietal name.
(b) The following are examples of markings or descriptions that may
be misleading:
(1) Use of the term ``yellow emerald'' to describe golden beryl or
heliodor.
(2) Use of the term ``green amethyst'' to describe prasiolite.
Note to Sec. 23.26: A varietal name is given for a division of
gem species or genus based on a color, type of optical phenomenon,
or other distinguishing characteristic of appearance.
Sec. 23.27 Misuse of the words ``real,'' ``genuine,'' ``natural,''
``precious,'' etc.
It is unfair or deceptive to use the word ``real,'' ``genuine,''
``natural,'' ``precious,'' ``semi-precious,'' or similar terms to
describe any industry product that is manufactured or produced
artificially.
Sec. 23.28 Misuse of the words ``flawless,'' ``perfect,'' etc.
(a) It is unfair or deceptive to use the word ``flawless'' as a
quality description of any gemstone that discloses blemishes,
inclusions, or clarity faults of any sort when examined under a
corrected magnifier at 10-power, with adequate illumination, by a
person skilled in gemstone grading.
(b) It is unfair or deceptive to use the word ``perfect'' or any
representation of similar meaning to describe any gemstone unless the
gemstone meets the definition of ``flawless'' and is not of inferior
color or make.
(c) It is unfair or deceptive to use the word ``flawless,''
``perfect,'' or any representation of similar meaning to describe any
imitation gemstone.
Appendix to Part 23--Exemptions Recognized in the Assay for Quality of
Gold Alloy, Gold Filled, Gold Overlay, Rolled Gold Plate, Silver, and
Platinum Industry Products
(a) Exemptions recognized in the industry and not to be
considered in any assay for quality of a karat gold industry product
include springs, posts, and separable backs of lapel buttons, posts
and nuts for attaching interchangeable ornaments, bracelet and
necklace snap tongues, metallic parts completely and permanently
encased in a nonmetallic covering, field pieces and bezels for
lockets,\38\ and wire pegs or rivets used for applying mountings and
other ornaments, which mountings or ornaments shall be of the
quality marked.
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\38\ Field pieces of lockets are those inner portions used as
frames between the inside edges of the locket and the spaces for
holding pictures. Bezels are the separable inner metal rings to hold
the pictures in place.
Note to Paragraph (a): Exemptions recognized in the industry and
not to be considered in any assay for quality of a karat gold
optical product include: the hinge assembly (barrel or other special
types such as are customarily used in plastic frames); washers,
bushings, and nuts of screw assemblies; dowels; springs for spring
shoe
[[Page 40675]]
straps; metal parts permanently encased in a non-metallic covering;
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and for oxfords,\39\ coil and joint springs.
\39\ Oxfords are a form of eyeglasses where a flat spring joins
the two eye rims and the tension it exerts on the nose serves to
hold the unit in place. Oxfords are also referred to as pince nez.
(b) Exemptions recognized in the industry and not to be
considered in any assay for quality of a gold filled, gold overlay
and rolled gold plate industry product, other than watchcases,
include joints, catches, screws, pin stems, pins of scarf pins, hat
pins, etc., field pieces and bezels for lockets, posts and separate
backs of lapel buttons, bracelet and necklace snap tongues, springs,
and metallic parts completely and permanently encased in a
---------------------------------------------------------------------------
nonmetallic covering.
Note to Paragraph (b): Exemptions recognized in the industry and
not to be considered in any assay for quality of a gold filled, gold
overlay and rolled gold plate optical product include: Screws; the
hinge assembly (barrel or other special types such as are
customarily used in plastic frames); washers, bushings, tubes and
nuts of screw assemblies; dowels; pad inserts; springs for spring
shoe straps, cores and/or inner windings of comfort cable temples;
metal parts permanently encased in a nonmetallic covering; and for
oxfords, the handle and catch.
(c) Exemptions recognized in the industry and not to be
considered in any assay for quality of a silver industry product
include screws, rivets, springs, spring pins for wrist watch straps;
posts and separable backs of lapel buttons; wire pegs, posts, and
nuts used for applying mountings or other ornaments, which mountings
or ornaments shall be of the quality marked; pin stems (e.g., of
badges, brooches, emblem pins, hat pins, and scarf pins, etc.);
levers for belt buckles; blades and skeletons of pocket knives;
field pieces and bezels for lockets; bracelet and necklace snap
tongues; any other joints, catches, or screws; and metallic parts
completely and permanently encased in a nonmetallic covering.
(d) Exemptions recognized in the industry and not to be
considered in any assay for quality of an industry product of silver
in combination with gold include joints, catches, screws, pin stems,
pins of scarf pins, hat pins, etc., posts and separable backs of
lapel buttons, springs, bracelet and necklace snap tongues, and
metallic parts completely and permanently encased in a nonmetallic
covering.
(e) Exemptions recognized in the industry and not to be
considered in any assay for quality of a platinum industry product
include springs, winding bars, sleeves, crown cores, mechanical
joint pins, screws, rivets, dust bands, detachable movement rims,
hat pin stems, and bracelet and necklace snap tongues.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2018-17454 Filed 8-15-18; 8:45 am]
BILLING CODE 6750-01-P