Tariff Classification of Rough Diamonds, Unsorted Diamonds, and Unworked Diamonds
Memorandum D10-17-41

Ottawa, January 15, 2015

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In Brief

The editing revisions made in this memorandum do not affect or change any of the existing policies or procedures.

This memorandum explains the Canada Border Services Agency (CBSA) policy regarding the definition and classification of "rough diamonds," "unsorted diamonds" and "unworked diamonds" for the purpose of heading 71.02 of the Customs Tariff.

Legislation

Customs Tariff

71.02 Diamonds, whether or not worked, but not mounted or set.

7102.10.00 - Unsorted

- Industrial:

7102.21.00 - - Unworked or simply sawn, cleaved or bruted

7102.29.00 - - Other

- Non-industrial:

7102.31.00 - - Unworked or simply sawn, cleaved or bruted

7102.39.00 - - Other

71.05 Dust and powder of natural or synthetic precious or semi-precious stones

7105.10.00 - Of diamonds

Harmonized System Explanatory Notes

Heading 71.02 (in part)

The heading covers unworked stones, and stones worked, e.g., by cleaving, sawing, bruting, tumbling, faceting, grinding, polishing, drilling, engraving (including cameos and intaglios), preparing as doublets, provided they are neither set nor mounted.

Subheading 7102.10

Before "unworked" or rough diamonds are marketed as "industrial" or "non-industrial" they are graded and sorted in terms of technical criteria by diamond experts. The technical criteria include weight (mass) and crystallographic suitability for cutting. Account is also taken of shape, transparency, colour and clarity or quality of crystals.

This subheading covers those lots (i.e., parcels) of diamonds or single diamonds which have not been submitted to such expert examination.

This subheading also includes parcels of rough diamonds that have only been sieved and that are packaged according to size without having been submitted to further expert examination."

Subheadings 7102.21 and 7102.29 (in part)

These subheadings cover the following natural diamonds:

(1) Diamonds proper, that is to say, transparent or translucent diamonds which because of their characteristic features cannot, normally be used for jewellery or for goldsmiths' or silversmiths' wares.

(2) Black diamonds, and other polycrystalline diamond-aggregates, including carbonados, which are harder than transparent diamonds.

(3) Bort proper, that is to say, opaque diamonds and other diamonds (including waste from working diamonds), normally unsuitable for cutting.

(4) Diamonds which because of their characteristic features (colour, clarity or quality, transparency, etc.) are destined for precise, particular uses in industrial applications (such as dressers, wire-drawing dies, or diamond anvils), but which are also suitable for use in jewellery.

These diamonds are generally intended for setting in tools (diamond cutting tools, boring tools, etc.) or fitting to machine accessories or machinery.

Subheading 7102.21 covers:

(1) Diamonds in their natural state, i.e., as they occur in deposits or extracts from the parent rock, sorted into lots or parcels.

(2) Diamonds simply sawn (e.g., into thin strips), cleaved (by splitting along the natural plane of the layers) or bruted, tumbled or which have only a small number of polished facets (e.g., so-called windows, which are mostly made to allow expert examination of the internal characteristics of the rough diamond) i.e., stones which have only a provisional shape and clearly have to be further worked. The strips may also be cut into discs, rectangles, hexagons or octagons, provided that all the surfaces and ridges are rough, matt and unpolished.

(3) Tumbled diamonds of which the surface has been rendered glossy and shiny by chemical treatment, also known as chemical polishing. Chemical polishing is different from traditional abrasive polishing in that the diamonds are not mounted individually and polished on a polishing wheel, but are loaded – in bulk – into a chemical reactor.

(4) Broken or crushed diamonds.

Subheading 7102.29 covers polished or drilled diamonds, and engraved diamonds (other than diamonds engraved for identification purposes only).

Subheadings 7102.31 and 7102.39

These subheadings cover natural diamonds which, because of their characteristic features (colour, clarity or purity, transparency, etc.) are suitable for use by jewellers, goldsmiths or silversmiths.

Subheading 7102.31 covers:

(1) Diamonds in their natural state, i.e., as they occur in deposits or extracts from the parent rock, sorted into lots or parcels.

(2) Diamonds simply sawn, cleaved (by splitting along the natural plane of the layers), bruted or which have only a small number of polished facets (e.g., so-called windows, which are mostly made to allow expert examination of the internal characteristics of the rough diamond), i.e., stones which have only a provisional shape and clearly have to be further worked.

(3) Tumbled diamonds of which the surface has been rendered glossy and shiny by chemical treatment, also known as chemical polishing. Chemical polishing is different from traditional abrasive polishing in that the diamonds are not mounted individually and polished on a polishing wheel, but are loaded – in bulk – into a chemical reactor.

Subheading 7102.39 covers:

(1) Polished diamonds having multiple flat polished surfaces or facets, which do not require to be further worked before being used in jewellery.

(2) Drilled diamonds, engraved diamonds (including cameos and intaglios) and diamonds prepared as doublets or triplets.

(3) Diamonds which were subjected to polishing and drilling or engraving and were broken during these operations, as well as polished diamonds broken during their transportation or storage.

Subheading 7102.39 does not cover:

(a) Diamonds which have only a small number of polished facets (e.g., windows which are made to allow expert examination of the internal characteristics of the rough diamond) and which clearly have to be further worked;

(b) Diamonds which have only been engraved for identification purposes.

Guidelines and General Information

Unworked (Rough) Diamonds

1. The term "rough diamonds" is used throughout the diamond trade. It does not, however, appear in the English version of the Customs Tariff. The French version of the Customs Tariff uses the term "diamants bruts," which translates to English as "rough diamonds." The Explanatory Notes to heading 71.02 also translate the term "unworked stones" as "diamants à l'état brut." For purposes of heading 71.02, the term "rough diamonds" means diamonds that may have been cleaned but that have not been worked in terms of various diamond finishing processes, such as grinding, faceting or polishing.

2. "Rough diamonds" may be sorted (as industrial or nonindustrial) or unsorted. "Rough unsorted diamonds" include parcels that have been sieved only and that are packaged according to size with no further examination. "Rough sorted diamonds" have been submitted to further expert examination and are sorted according to shape, transparency, colour and clarity or quality of crystals.

3. "Rough diamonds" that have been engraved for identification purposes only are still classified as unworked diamonds.

4. "Rough diamonds" include tumbled diamonds where the surface has been rendered glossy and shiny by chemical treatment (chemical polishing). Chemical polishing is different from traditional abrasive polishing in that the diamonds are not mounted individually and polished on a polishing wheel, but are loaded – in bulk – into a chemical reactor.

5. The term "rough diamonds" also applies to diamonds with a single facet or window and to diamonds referred to as "marked roughs." Before sale or cutting, a cutter may remove a very small part of the outer layer (skin) of the "rough diamond" in order to examine the interior of the diamond and assess its characteristics. "Marked roughs" are diamonds that have been marked by a cutter or gemologist to show the desired direction of cutting and polishing.

6. The descriptions "partially polished rough diamonds" and "partially polished diamonds" are also used in the diamond trade. These are not rough diamonds (unsorted or unworked) for purposes of the Harmonized System. The classification of such diamonds is determined on the basis of the cutting and polishing processes that have been completed. For example, gem-quality diamonds with a round brilliant cut made by simply sawing (table facet), cleaving or bruting are classified under subheading 7102.31. Similar diamonds, which have been further faceted (blocked) or finished (brillianteered), but not polished, are classified under subheading 7102.39.

7. Rough diamonds are classified either as "Unsorted" of subheading 7102.10 or "Unworked" of subheadings 7102.21 or 7102.31.

Unsorted Diamonds

8. "Unsorted diamonds" of subheading 7102.10 have been separated from the surrounding earth. No determination has been made as to whether they are industrial or nonindustrial diamonds. They may have undergone surface cleaning and primary sorting for the purposes of government valuation and they may also have been sieved and/or weighed, and grouped on the basis of weight. No other work (e.g., faceting, grinding, polishing) has been done. The work completed on these diamonds (e.g., cleaning, weighing) does not involve technical experts or trained sorters and does not result in diamonds being ready for market.

Unworked Diamonds

9. Unworked diamonds have not been subject to any finishing work processes, e.g., faceting, grinding, or polishing. They have undergone final sorting, in which they have been sorted and graded into lots by a trained technician or sorter. The determination of industrial or non-industrial (gem and near gem) is made at this stage without regard to the actual end use. Unworked diamonds are classified under subheading 7102.21 (industrial) or subheading 7102.31 (non-industrial).

10. These subheadings also include simply sawn, cleaved or bruted rough diamonds – processes that prepare the stones for their optimum use. Rough diamonds may be sawn into provisional shapes (spheres, discs, rectangles, hexagons or octagons) provided all surfaces and ridges are rough, matt and unpolished.

Other Worked Diamonds

11. Other worked diamonds, other than those that are sawn, cleaved or bruted, are classified under subheading 7102.29 or 7102.39. These other processes include faceting, grinding, polishing, drilling, engraving (including cameos and intaglios, but not diamonds engraved for identification purposes only) preparing as doublets, as well as blocking (lapping, cross working) or brillianteering.

12. Previously cut and polished diamonds that are damaged and chipped and require repolishing or recutting are still classified as worked diamonds since they have already undergone a cutting and polishing process. They are not considered rough diamonds for classification purposes. These diamonds may be exported for repair e.g. recut, repolished and then returned as cut and polished diamonds. These are not to be confused with damaged or crushed diamonds that have not undergone further processing or cannot be identified as having been previously cut and polished.

13. Diamond dust and powder particles less than or equal to 1,000 microns are classified under subheading 7105.10 and are not considered to be rough diamonds. Subheading 7102.21 covers broken or crushed rough diamonds of a diameter greater than 1,000 microns.

Kimberley Process

14. Canada, along with many other countries, has participated in the international "Kimberley Process," and its development of proposals for an international certification scheme for the control of the import and export of rough diamonds. Under The Export and Import of Rough Diamonds Act (Natural Resources Canada), in effect since January 1, 2003, imports and exports of rough diamonds in Canada need to be accompanied by a Kimberley Process Certificate. Trade in rough diamonds with non-participants in the scheme is prohibited. For the purposes of the Kimberley Process, rough diamonds are classified under subheadings 7102.10, 7102.21 and 7102.31.

Additional Information

15. For certainty regarding the tariff classification of a product, importers may request an advance ruling. Details on how to make such a request are found in Memorandum D11-11-3, Advance Rulings for Tariff Classification.

16. For more information, within Canada call the Border Information Service at 1-800-461-9999. From outside Canada call 204-983-3500 or 506-636-5064. Long distance charges will apply. Agents are available Monday to Friday (08:00 – 16:00 local time / except holidays). TTY is also available within Canada: 1-866-335-3237.

References

Issuing office:
Trade and Anti-dumping Programs Directorate
Headquarters file:
HS 7102.00
Legislative references:
Customs Tariff
Other references:
D11-11-3
Superseded memorandum D:
D10-17-41 dated November 1, 2006
Date modified: