The diamond grading business, EGL International – also known as EGL Laboratories Eurogem (Israel) – has reportedly had its license to use the EGL name withdrawn.
A statement issued by “the holders of the worldwide rights” of EGL (European Gemological Laboratory) was recently issued to members of the global diamond industry notifying them that a licence agreement with the EGL International branch had been revoked on 25 November 2014.
“Upon termination of the licence, as of that date, this lab is not authorised to issue certificates bearing the EGL trademark in any form whatsoever and/or represent the EGL brand,” the statement read, adding that any certificate issued by the laboratory would be considered a “counterfeit” report.
EGL International made headlines last year when it found itself central to the diamond ‘over-grading’ debate instigated by Martin Rapaport of the Rapaport Group in September.
After a number of diamond trading platforms announced they would no longer be listing grading reports from any EGL branch due to fears they had been overstating the quality of the diamonds assessed, the embattled network moved to restructure its organisation.
As part of this, it was rumoured the EGL International affiliate in Israel would be closed with the ‘International’ name to be removed from all grading certificates.
However, according to the recent statement, EGL International CEO Guy Benhamou had “taken control of the company and acts in it without their [the EGL rights owners’] approval”. It added that the EGL “rights owners” had taken legal action to dissolve the company.
Furthermore, it was noted that the only Israel-based affiliate eligible to issue grading reports using the EGL name was EGL Platinum. EGL Platinum is headed by Menahem Sevdermish, the man that was appointed to coordinate the EGL network restructure in December last year.
Denials
EGL International has denied the claims, retaliating with its own statement.
“We wish to clarify, unequivocally, that the notice is deceitful as it attempts, by entirely improper means, to harm our operations and cause us damage,” the EGL International statement read.
According to the company, a valid, long-term franchise agreement that permitted the issuing of certificates using the EGL International name remained in place until 2020.
“We totally condemn threats made to our customers. [Members of the Israel Diamond Exchange (IDE), or groups connected with them are] attempting to cause damage to our long-term connections with clients by the use of threats and legal liability.
“Needless to say, in spite of their extreme claims, these same groups have not turned to any legal institute, in the IDE or in the court system, in order to prove their claims, as their demand for dismantling our company that is mentioned in their notice is without basis and was also submitted as part of their attempts to damage us.”
EGL International will reportedly continue to operate as per normal.
Background reading
Statement by EGL network
Statement by EGL International
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