De Beers welcomes probe into diamond exports

De Beers welcomes probe into diamond exports
Reuters - Wednesday, May 28 10:27 am

JOHANNESBURG (Reuters) - De Beers, the world's biggest diamond producer, said on Wednesday it welcomed a fresh probe by South Africa's parliament of allegations that it exported a huge volume of diamonds during the mid-1990s.

Some parliamentarians have alleged that De Beers exported the gems to London in the period leading up to the black majority rule in South Africa -- a time of massive capital flight and tax avoidance.

The team, assisted by South Africa's auditor-general, would hope to determine the De Beers London stockpile records between the period December 3, 1992 to March 19, 1998, which a top official told Reuters amounted to about 1 billion rand (65.33 million pounds).

De Beers, which is 45 percent owned by global mining giant Anglo American , welcomed the investigation.

"We are ready to participate in this investigation completely and we have been ready to do so from the start," Tom Tweedy, De Beers' spokesman in Johannesburg said.

"There was nothing extraordinary on the exports and nothing was done out of the normal process of diamond exports."

The recommendation to set up the team, contained in a public accounts committee report adopted by parliament, re-opens a long standing dispute, which both De Beers and a senior South African government official said last year had been settled.

Tweedy reiterated De Beers had last year taken part in a similar probe by another parliamentary organ, and provided documents requested by a parliamentary sub-committee.

"We understood it had been sorted out," Tweedy said.

At one stage, South Africa considered litigation to compel De Beers to pay a disputed 15 percent export tax on the shipment of 22 million carats of uncut diamonds to London in 1992.

But De Beers has strenuously denied that exports in the mid-1990s were larger than normal or that it had benefited from improper exemptions of export duties.