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The platform was launched to provide a solution for "unfairly displaced" grading laboratories
The platform was launched to provide a solution for "unfairly displaced" grading laboratories

Banned diamond lab hits back with own trading network

One of the international grading laboratories recently banned from online diamond trading network RapNet has announced it will be establishing its own diamond trading platform.

The new platform from the US arm of European Gemological Laboratories (EGL), EGL USA, will offer basic inventory data on certified diamonds from “all major” international laboratories.

“The site will provide posting and browsing capability, enabling wholesalers, dealers and jewellers to contact one another and do business directly,” an EGL USA statement explained. “Platform members will be invited to register an unlimited number of users on each of their accounts. The site, initially operating in beta format, will introduce additional features over time.”

The announcement followed the decision by Rapaport Group’s online trading network, RapNet, to ban EGL grading reports because of concerns that EGL branches were using Gemological Institute of America (GIA) grading terminology to overstate the quality of a diamond while applying alternative grading standards – a practice that Rapaport Group chairman Martin Rapaport has since dubbed “over-grading”.

RapNet stopped listing EGL branches on 1 October 2014.

One of EGL USA’s directors, Yaakov Tversky, said, “The new [EGL USA] platform will be free, open and independent, and it will provide an immediate, no-cost solution for our business partners, who were unfairly displaced by RapNet.

“We look forward to seeing the site grow into a full-fledged resource that will support the success of our customers, as well as the industry at large.”

At the time of publication, the EGL USA’s trading platform was said to be in its final testing stages and expected to launch shortly.

EGL USA vs EGL International
In the past, EGL USA had attempted to distinguish itself from other EGL branches, going so far as to bring trademark infringement and false advertising claims against EGL divisions outside of North America for both “their inflated grading practices and improper use of the EGL name in the US”.

Mitch Jakubovic, an EGL USA director, said Rapaport Group had been aware of the legal action and that it had consistently distinguished the North American branch from their international counterparts.

“Just last year, Rapaport verified the quality of EGL USA analyses as comparable to top tier labs, such as GIA,” Jakubovic added.

However, at the time of the decision, while RapNet acknowledged in its press release that some EGL grading reports were “more consistent with GIA grading standards than others”, the ban was ultimately applied to all EGL branches due to the “confusion and inconsistency” of their grading reports.

As previously reported by Jeweller, the local jewellery industry has also taken action in the diamond grading debate. The Jewellers Association of Australia (JAA) last month released a list of “reputed” laboratories in order to assist its members in abiding by the Code of Conduct, as well as for use as a reference point when dealing with consumer complaints. No EGL branches were included in the list.

Update/clarification – 5 December 2014, 11:30am AEST

Since publication, Deborah Jakubovic, EGL USA executive manager, has contacted Jeweller wishing to clarify certain matters pertaining to this article.

Jakubovic advises: "The text alternately refers to EGL USA as the 'US arm' and 'branch' and 'counterpart' of 'European Gemological Laboratories'. All of these labels are incorrect. Our name is simply EGL USA Gemological Laboratory. (We are not 'European'.) And EGL USA is in no way connected or affiliated with any EGL-named laboratories outside of North America.

"EGL USA is a highly regarded, independent gemological laboratory. The recent delisting of EGL USA by RapNet is not a reflection of the quality of our work. It is an unfair penalty, imposed upon us solely because of our name."

More reading
Diamond grading furore continues; ‘approved’ lab list released
Diamond grading fight – GIA v EGL, refereed by Rapaport
Industry called to fight diamond over-grading
Industry reacts to diamond grading concerns
Diamond grading reports banned

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