The Gemstone Information Manual by the American Gem Trade Association

The Federal Trade Commission Guides for the Jewelry Industry as revised April 10, 2001 are designed to prevent unfair or deceptive trade practices. The revised Guides contain new language as to gemstone enhancement disclosure requirements which apply equally to diamonds and all other natural materials.

This manual contains information necessary for minimal compliance with the revised FTC Guides and ethical jewelry trade practices. It also provides a useful method to communicate required gemstone treatment disclosure information within the trade.

FTC Disclosure Requirements

With the exception of the normal fashioning (cutting and polishing) of a gemstone, it is the seller's responsibility at all levels of commerce to clearly disclose to the buyer at the time of the sale:

1. Whether the gemstone is natural or not;
2. All information pertinent to any enhancement process done to a natural gemstone when:

   a. The treatment is not permanent and its effects are lost over time when
   b. The treatment creates special care requirements for the gemstone to retain the benefit of the treatment
   c. The treatment has a significant effect on the value of the gemstone

Minimal disclosure information would include whether the gemstone is natural or man-made; if natural, whether the gemstone has been treated in a manner where 2 (a), (b) or (c) above apply; in such cases, the nature of the treatment, its permanence and any special care requirements.

As to ''significant effect on the value,'' the position of the FTC is that treatment has a significant effect on the value of a gemstone whenever the effect of treatment on value is likely to affect a reasonable buyer's purchasing decision. Such is the case whenever there is a significant (more than slight) difference in the value between a treated gemstone and an untreated gemstone of the same type, size and appearance. The FTC's comments to the revised Guides state that ''the consumer's point-of-view is the relevant viewpoint from which to analyze the necessity for disclosure.'' Treatment must be disclosed whenever a buyer, without disclosure of treatment, would believe that two seemingly identical gemstones, one treated and one not, are identical or very comparable in value, when in fact, they are not.

Small gemstones, whether mounted or not, are not exempt from any disclosure requirements. However, when applying the ''significant value'' test in the case of jewelry products, the effect on the composite value of the mounted piece should be considered.

When it is not known with certainty whether or not a gemstone has been treated, but treatment is suspected (as in the case of gemstone types which are known to be routinely treated), the FTC states that, ''it is prudent and appropriate to disclose gemstone treatments rather than remain silent when there is a possibility that the stones have been treated.''

This minimum disclosure information is required by the FTC. Failure to disclose that a gemstone is not natural, or enhancement information as to a treated natural gemstone in compliance with the FTC Guides, subjects the violator to FTC enforcement action, civil penalties and trade sanctions.

Any seller who is uncertain as to these requirements may write the Jewelers Vigilance Committee, Inc., 25 West 4th Street, Suite 400, New York, NY 10036, or the American Gem Trade Association, 3030 LBJ Frwy., Ste. 840, Dallas, TX 75234.

These disclosure requirements are applicable to all sellers at each and every level of gemstone and jewelry commerce, including sellers of uncut gemstone material and cut and polished gemstones, manufacturers and wholesalers of jewelry containing natural or man-made gemstones, and retail sales to consumers. Disclosure must be made at the point of sale prior to sale; provided, however, that where a gemstone or a jewelry product which contains gemstones can be purchased without the buyer personally viewing the product (e.g., catalog sales, catalog showrooms, mail order houses, online services, televised shopping programs or other media sales programs, telephone sales, etc.), disclosure must be made in the solicitation for or description of the product.

Disclosure Methods within Trade

Gemstones have historically and traditionally been enhanced. The methods of the enhancement processes vary within each variety and change as new and better methods are developed.

The Federal Trade Commission, with the cooperation of the Jewelers Vigilance Commission and other industry associations, requires the jewelry industry to inform all buyers of gemstone enhancements. This manual provides a listing of traditional, historical and contemporary enhancements, as well as a convenient means of communicating treatment information within the trade.

The codes listed in this manual provide an easy-to-understand shorthand system of labeling to be used only within the trade. Each material that may require disclosure has been assigned a code consisting of one or more letters indicating the enhancement (or the possibility of enhancement) and identifying the pertinent process. Disclosure should be made within the trade on every tag, stone paper, container, invoice, memorandum or other commercial document each time a seller offers for sale or sells a gemstone or jewelry product containing gemstones to a buyer within the trade. Use of the disclosure codes provided herein gives the gem and jewelry industry a convenient means of complying with disclosure of gemstone treatment within the trades as required by the Federal Trade Commission Guides.

It should be remembered, however, that the use of the codes to accomplish disclosure within the trade is a matter of convenience and choice. A seller is free to use any language or method to disclose treatment that fulfills the FTC requirements. Use of the codes, however, is encouraged to promote a uniform and consistent communication language.

Consumer Disclosure Requirements

The information in this manual will assist retail sellers in meeting disclosure requirements by providing all necessary information that must be disclosed to consumers. However, when disclosing to retail consumers, all required disclosure must be made in plain language. Codes and/or abbreviations are not sufficient. Various trade associations publish a variety of consumer information products which are available to retail sellers as aids to communicate required disclosure information to retail consumers.

AGTA Member Requirements

The above requirements are applicable to all sellers at all levels of commerce within the trade. The disclosure requirements of the American Gem Trade Association are more stringent than the FTC minimal requirements, and all AGTA Firm and Affiliate Members are bound by and must disclose in accordance with the AGTA Code of Ethics which is not changed by the revision of the FTC Guides.

This edition of the Gemstone Information Manual was submitted to the Federal Trade Commission on behalf of the gem and jewelry industry for informational purposes.

Definitions

Enhancement Any traditional process other than cutting and polishing that improves the appearance (color/clarity/phenomena), durability or availability of a gemstone.

A gemstone enhancement is considered permanent as long as the effect of the enhancement does not change under normal wear, cutting, repair, cleaning or display conditions. If a gemstone enhancement is not permanent, appropriate disclosure is required.

All natural gemstones can be divided into three basic categories:

1. Those which are not enhanced.
   • N
     The ''N'' symbol appears on the chart only for natural gemstones which are not currently known to be enhanced (Alexandrite, Garnet, etc.). However, the ''N'' symbol can also be used for other natural gemstones in the event that a gemstone has received no enhancement and the seller will provide a guarantee that there has been none. That gemstone must be accompanied by a commercial document, such as an invoice, memorandum and/or a laboratory report, to support the fact that the gemstone is not enhanced.
2. Those which are normally enhanced.
   • E
     The ''E'' symbol indicates that the gemstone had undergone its traditional enhancement process. The type of enhancement process covered by this symbol is indicated in the chart notes section of this article below. For example: The ''E'' designation for Aquamarine means only that the enhancement that is described in the Gemstone Information Chart below, i.e. thermal enhancement. In the case of Emerald, the ''E'' designation refers only to the penetration of colorless oil, wax and/or resins into fissures.
   • Since many enhancements are difficult or impractical to prove definitively, the approach taken in this manual is, unless otherwise indicated, to assume that such traditional enhancement has been done to that particular gemstone. This assumption has been made in order to protect both the seller and the consumer.
   • The ''E'' symbol may be used for those gemstones and for those enhancements as prescribed on the chart. However, if the specific method of enhancement is known, the seller should use the specific enhancement code in place of the ''E'' symbol. (For example: ''H'' would be used for an Aquamarine in place of ''E'').
3. Those treatment processes not covered under the ''N'' or ''E'' symbols are addressed in a specific manner as shown in the chart notes section of this article below.
   • For example, Ruby ''F.'' The surface cavities are filled with a foreign matter such as glass. Within the industry, this gemstone must be labeled with the letter ''F.'' This information must also be provided to the consuming public in writing using plain language. Abbreviations and codes are not sufficient.

Note: Multiple enhancement techniques are sometimes applied to the same material. All treatments must be listed. Example: Diamond ''LF'' (Lasering and Filling).

Defined below are the specific enhancement codes and designations to be used in the Gemstone Information Chart below.

Symbols for Specific Forms of Enhancements

Designations

Designations are based on a consensus of opinion rather than any available documentation.

• Enhancement Frequency Designations
  1. Rarely
  2. Occasionally
  3. Commonly
  4. Usually
  5. Always
  6. Unknown
• Enhancement Stability Designations
  1. Excellent
  2. Very Good
  3. Good
  4. Fair
  5. Poor
  6. Variable
• Care Designation
1. Normal
2. Special
3. Extra Special

Introduction of the Gemstone Information Chart

Please keep in mind the following information when reading and interpreting the Gemstone Information Chart:

• The column labeled FREQUENTLY USED represents a reasonable estimate of how commonly a particular enhancement process is utilized in the trade, based on a consensus of opinion.
• The columns FREQUENTLY USED and STABILITY refer specifically to the enhancement process applied to the material.
• The CARE REQUIRED and SPECIAL ADVICE columns reflect two basic concerns. The first relates to special care that may be necessary to preserve the effect of the enhancement applied to the material and the second issue addresses the need for any special care required by the specific gemstone variety, irrespective of enhancement.

Chart Notes

The N symbol may be used for any gemstone that the seller guarantees has not been enhanced.

The E symbol indicates a gemstone that is routinely enhanced. It can only be used for enhancements for specific gemstones as prescribed on the above chart.

All other Tag Codes are defined at the bottom of this article.

Information Requirements for Man-Made Materials that Resemble Natural Gemstones

This manual sets forth proper methods to comply with FTC Guides regarding synthetic, simulated and imitation stones. Historically, materials have been produced to duplicate or imitate the appearance of natural gemstones. When non-natural materials or other gemstone substitutes are offered for sale, it is the seller's responsibility to inform buyers that these ''man-made materials'' are not ''natural gemstones.'' This information is required by the Federal Trade Commission (FTC).

Such information is required at each and all levels of gem and jewelry commerce. Those specifically responsible to inform buyers include sellers of the uncut and cut/polished non-natural materials; manufacturers and wholesalers of jewelry containing non-natural materials; retailers, including sales over the counter, catalog, catalog showrooms, mail order firms, internet, television or other media sales programs; and advertisers.

Anyone who is uncertain about these requirements may write the Jewelers Vigilance Committee, 25 West 4th Street, Suite 400, New York, NY 10036, or the American Gem Trade Association, 3030 LBJ Frwy., Ste. 840, Dallas, TX 75234.

Purpose

This manual provides an easy-to-understand shorthand system for labeling. Each of the broad non-natural material categories has been assigned a code consisting of two or more letters. Each code identifies the nature of material from which it was made.

The appropriate code is to be used within the trade on every tag, stone paper, container, invoice, memorandum or other commercial document each time a seller offers for sale or sells one of these materials to a buyer within the trade.

However, codes and abbreviations are not sufficient when dealing with the consuming public. In order to clearly disclose the nature of these products, and to make it perfectly clear that they are not natural gemstones, plain language, not codes or abbreviations, must be used in all advertising and promotion, stone papers, containers, sales slips, invoices, memoranda or other commercial documents. For example, the word(s) ''Synthetic'' or ''Laboratory Grown,'' ''Imitation,'' ''Assembled,'' or some other word or phrase of like meaning must be used in place of, or in addition to, abbreviations or code symbols.

Trade names used to promote various products must be accompanied by a specific reference to the actual composition of the material(s) the product contains.

Synthetic Stones

The term ''synthetic'' is scientifically correct and is appropriate for use within the trade. When communicating to the consumer, retail jewelers have the option to call these materials either synthetic or by some other word or phrase of like meaning so as to clearly disclose the nature of such product and the fact that it is not a natural gemstone, such as ''man-made'' or ''laboratory grown.''

SYN

• The tag code may be used to describe ''synthetic'' materials that have essentially the same optical, physical and chemical properties as a naturally occurring counterpart. The code name may not be used as a noun; thus a stone must not be referred to as a ''synthetic.'' In all cases, the name of the stone must also be used; thus, a stone must be referred to as ''synthetic emerald,'' ''synthetic ruby,'' etc.

Examples: SYN Emerald, Ruby, Sapphire (various colors and colorless), Spinel, Alexandrite, Cat's Eye Alexandrite, Amethyst, etc.

The Tag Code may not be used with the consuming public; only plain language is acceptable.

Synthetic stones are as stable in color and composition as their natural untreated counterpart.

Imitation Products - Simulants (Substitutes)

IMIT

• ''IMIT'' is the tag code used for a manufactured product fabricated in such materials as glass, ceramic or plastic designed to imitate or resemble the appearance, but not duplicates the characteristic properties of a natural gemstone.

These materials may require special care; avoid household chemicals, abrasives and sudden shocks.

''IMIT'' is also the tag code for a simulant, which is defined as a man-made single crystal product that is used to simulate the appearance, but not duplicate the characteristic properties of the natural gemstone it imitates.

Examples are: synthetic Spinel, synthetic Sapphire, synthetic Quartz, YAG, GGG, strontium titanate and synthetic Cubic Zirconia produced in various colors to imitate gemstones in different species.

This category also includes non-single crystal materials such as imitation Lapis Lazuli and imitation Coral.

NOTE: Trade names used to promote various simulant products in these categories must be accompanied by a specific reference to the actual composition of the simulant crystal material.

Assembled Materials (Composite)

ASBL

• ''ASBL'' is the tag code for products made of multiple layers or combinations of manufactured and/or natural material fused, bonded or otherwise joined together to increase stability and/or imitate the appearance of a natural gemstone, create a unique design or generate unusual color combinations.

Examples:

ASBL Opals--(Various Combinations) Doublets and Triplets

ASBL Garnet--Glass Doublets

ASBL Sapphire--Synthetic Sapphire Doublets

ASBL Colorless Beryl--joined by green bonding (Triplets)

ASBL Mabe ''Pearls'' color coated, dyed, bleached, filled with hardened substances and a Mother of Pearl back. Sometimes                                coating can be plastic or polymer to protect the thin nacre.

ASBL Bonded materials such as Turquoise, Lapis, etc.

The ''ASBL'' coded stones require special care; avoid household chemicals, cosmetics, abrasives and sudden shocks.