In the late 1990s, conflict diamonds as defined by the United Nations accounted for around 4% of the global diamond trade, although some NGOs considered the percentage to have been higher.
	The UN, governments, NGOs, De Beers and the rest of the diamond industry recognised the need for a global system to prevent conflict diamonds from entering the legitimate diamond supply chain. The system put in place was called the Kimberley Process. Today, as confirmed by the official report of the Chair of the Kimberley Process in October 2004, more than 99% (99.8%) of diamonds are certified conflict free through the Kimberley Process Certification Scheme (KPCS). The Kimberley Process is a joint government, diamond industry and NGO initiative that imposes extensive requirements on participants to certify that shipments are free from conflict diamonds. The KPCS came into effect on 1 January 2003 and requires all participating governments – 71, including those represented by the European Commission (EC) – to enact diamond laws and regulations. Today, diamonds are one of the most monitored and audited of any natural resource in the world. Under the KPCS, all international rough diamond shipments must be traded in tamper-proof boxes and accompanied by a forgery-proof certificate that states that they are conflict free. The certificate is issued by the exporting country government. Certification is backed by a system of internal controls in each country, including those that produce diamonds, as well as those that trade, cut and polish diamonds. The DTC and BDVC have their compliance with the Kimberley Process audited by a third party. Remaining De Beers entities will be third party audited at the end of 2006 and the beginning of 2007. In addition, De Beers subscribes to the industry’s system of warranties and the BPPs to which Sightholders must also subscribe.