The Gems and Jewelry Trade Association of China (GAC) published a self-discipline pact for the domestic online diamond trade on Tuesday in an attempt to protect consumers' rights in the country's fledgling Internet-based jewelry business.
The pact, dubbed as "The Self-discipline Pact for China's e-trade on Jewelry (Diamond)," was jointly formed by the GAC and nine major Chinese online jewelry companies. It is open to both domestic and international online jewelry dealers.
The pact is aimed to curb irregularities and fraudulent activities in the online jewelry business, said Sun Fengmin, secretary-general of the GAC, at Tuesday's press conference.
Fraudulent activities by some online jewelry dealers has infringed consumers' rights and impaired the healthy development of online jewelry trade in the country.
The pact specifically applies to the online diamond trade as the precious gem is more commonly traded internationally and domestically, compared to other jewelry items such as pearl and jade, said the GAC official. However, he urged e-traders of other jewelry to follow suit.
He expressed his hopes that the issuance of the pact could help improve service in the sector and make consumers more confident in e-business.
According to Shi Hongyue, deputy secretary-general of the GAC, there are about 100 domestic companies specialized in the online jewelry trade, and among these firms, merely 20-30 are better self-disciplined and operate strictly in accordance with law.
Furthermore, there are thousands of individuals in the country who have opened online jewelry shops.
In 2008, the online diamond trade stood at some 1 billion yuan (146 million U.S. dollars), and the figure is expected to double in 2009, according to the GAC.
"Under the impact of the current global financial crisis, consumers are more paying greater attention to cost-effectiveness when buying jewelry. Thus, there is a great opportunity for online jewelry trade," said Stone Xu, co-president of the Shanghai-based online jewel dealer Zbird.Com.
The cost of e-trading jewelry is about 30 percent lower as e-shops spend less on office rent and employees, compared with the traditional business model, Xu said.