The London Diamond Bourse (LDB) has stated that it is well equipped to deal with problems relating to Brexit. The organization says that its access to a bonded warehouse will enable duty-free trading, lowering costs for its members.
Overseen by customs authorities, bonded warehouses allow imports that are subject to customs duty to be stored duty-free before being re-exported. This means if the European Union imposes import restrictions on the U.K., LDB members will be able to use the facility to their advantage.
LDB told Rapaport News that London’s diamond industry may be hindered by the outcome of negotiations over the U.K.’s future relationship with the E.U.
“LDB is really well placed to defend its members as the future negotiations of the European Union and U.K. play out,” said Victoria McKay, CEO of the exchange. “If we remain part of the single market, we will still be able to offer bonded warehouse facilities to those members wishing to purchase outside the EU.”
However, pound’s drastic drop in value—approximately 12 per cent against the dollar since the announcement of Brexit—will prove to be an issue.
“The major problem for our members is the uncertainty in the currency,” added McKay.
