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De Beers Gets Russian Diamonds Back
The Supreme Court of the European Union in Luxembourg yesterday reversed a European Commission resolution prohibiting De Beers to buy diamonds from the Russian monopoly ALROSA beginning in 2009, ruling on an suit brought by ALROSA. That decision is unlikely to change the situation on the world diamond market in any case.
ALROSA and De Beers concluded an agreement in 2001 for the delivery of $800-million worth of diamonds to De Beers in the course of five years. De Beers informed the EC of the agreement after it was signed and the Europeans objected to violations of EU antimonopoly law. The EC adopted its decision in January 2006.
At the end of 2005, the ALROSA supervisory board approved a new sales strategy aimed toward selling diamonds independently in Moscow and expanding the company's client base. At present, De Beers accounts for about 19 percent of ALROSA sales, although it once bought over half of ALROSA production. Forty-three percent of ALROSA diamonds go to the domestic market. ALROSA is creating a sales system based on the model of De Beers, with a close circle of permanent clients, one of which will be De Beers.
www.kommersant.com
All the Article in Russian as of July 12, 2007
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