Gold hallmarking is a purity certification of the precious metal and is voluntary in nature at present. Buyers of gold jewellery will now have the assurance of buying pure gold. The government has made it mandatory for the jewellers to sell only hallmarked jewellery. The mandatory hallmarking of gold jewellery is coming into force from 16th June, 2021. However, initially, hallmarking will be starting in the 256 districts of the country which have Assaying marking centres.
Also, jewellers with annual turnover up to Rs 40 lakh will be exempted from mandatory hallmarking. The implementation of the gold hallmarking rules will be done in a phased manner, initially beginning with stores in 256 districts across India. Meanwhile, gold price today fell once again. Gold prices dropped by Rs 10 per 10 gram and Rs 100 per 100 gram.
How to identify if you are buying hallmarked jewellery?
There are 4 things to keep note of while buying hallmarked jewellery:
1. BIS Mark
2. Purity in carat and Fineness (any one)
a) 22K916 – Equal to 22 Carat
b) 18K750 – Equal to 18 Carat
c) 14K585 – Equal to 14 Carat
d) 20, 23 and 24 carat also to be hallmarked now
3. Identification Mark or Number of the Hallmarking Centre’s
4. Identification Mark or number of the Jeweller’s
Hallmarking will enable Consumers and Jewellery buyers to make a right choice and save them from any unnecessary confusion while buying gold. At present, only 30% of Indian Gold Jewellery is hallmarked. According to World Gold Council, India has around 4 lakh jewellers, out of this only 35879 have been BIS certified.
The Hallmarking of jewellery and artefacts is required to enhance the credibility of gold Jewellry and Customer satisfaction through third party assurance for the marked purity and fineness of gold, consumer protection.
Why New Hallmarking Rules?
While the government’s move will help consumers ensure the quality of gold jewellery they are buying, it will also help the country become a hub for buying gold in the world.
“The hallmarking of jewellery/artefacts is required to enhance the credibility of gold jewellery and customer satisfaction through third party assurance for the marked purity/fineness of gold, consumer protection,” the Ministry of Consumer Affairs, Food and Public Distribution said in a press release.
“This step will also help to develop India as a leading gold market centre in the world,” it added.
India is the second-largest consumer of gold in the world and in the first quarter of 2021, the country consumed 140 tonnes of gold, according to a report by the World Gold Council.
Jewelry that conforms to the benchmark will enjoy a premium, this can bring out the family silver as households start to exchange their older jewellery for new, hallmarked jewellery. This can potentially help monetise the ~$ 1.5 trillion of gold and jewellerry that is sitting in the almirahs of Indian households.
Gold Hallmarking: 10 Points to note before your next Gold Purchase
- Gold hallmarking is a ‘purity’ certification of the yellow metal to identify the fineness of gold and ensure consumer protection. It is voluntary in nature at present.
- Gold hallmarking is now mandatory for all 22-carat and 24-carat gold items. Gold of Additional carats such as 20, 23 and 24 will be allowed for Hallmarking.
- Gold watches, fountain pens and special types of jewellery like Kundan, Polki and Jadau will be exempted.
- Export and re-import of jewelry as per Trade Policy of Government of India – Jewellery for international exhibitions, jewellery for government approved B2B domestic exhibitions will be exempted from mandatory mallmarking.
- Gold jewellers with annual turnover up to ₹40 lakh have been exempted from mandatory hallmarking, the government stated.
- Manufacturers, wholesalers and retailers of Gold Jewellery have been given time and there would be No penalties till August end, the government added.
- India has nearly 4 lakh jewellers, out of which only 35,879 are BIS certified, as per the World Gold Council data.
- According to The Bureau of Indian Standard (BIS), the mandatory hallmarking will protect consumers against lower caratage and ensure they do not get cheated while buying gold ornaments.
- Hallmarking of gold jewellery was set to begin from June 15, but it was postponed due to the COVID-19 pandemic. The decision was taken at a meeting chaired by Union Consumer Affairs Minister Piyush Goyal. Earlier, it was expected to be implemented from January 15, 2021.
- BIS has been running a gold hallmarking scheme for gold jewellery since April 2000. About 40 per cent of gold jewellery across the country is being hallmarked currently.
What happens to your Old Gold Jewellery?
Following the announcement, many are wondering what will happen to their old jewellery that has not been hallmarked. As of now, individuals who own gold jewellery without hallmark do not need to worry; the directive is for sellers, aimed at improving the quality of gold purchased by consumers.
The government said that a committee constituting representatives of all stakeholders, revenue officials and legal experts will be formed to look into issues that could emerge after the implementation of the scheme. It may be noted that gold watches, fountain pens, special types of jewellery including Kundan, Polki and Jadau will be exempted from mandatory hallmarking. The government’s release also said that jewellers can continue to buy back old gold jewellery without hallmark from consumers.
“In order to give adequate time to the manufacturers, wholesalers and retailers of gold jewellery, there would be no penalties till August end. Old jewellery can be got hallmarked as it is, if feasible by the jeweller or after melting and making new jewellery,” the government said.
Few things to consider on New Hallmarking Rules
- Gold of Additional carats 20, 23 and 24 will also be allowed for Hall Marking.
- Watches, fountain pens and special types of jewellery viz. Kundan, Polki and Jadau will be exempted from Hall Marking.
- Jewellers can continue to buy back old gold jewellery without hallmark from consumer.
- In order to give adequate time to the manufacturers, wholesalers and retailers of Gold Jewellery, there would be no penalties till August end.
- Old jewellery can be got hallmarked as it is, if feasible by the jeweller or after melting and making new jewellery.
Everything you need to know about this new rule
- Gold hallmarking is a purity certificate of the precious metal.
- From June 15, 2021, jewellers will be able to sell only 14, 18 and 22 carats of gold jewellery and other artefacts. If a jeweller is found selling gold without BIS hallmark, he could be penalised five times the price of the product or could even face imprisonment of up to 1 year.
- The registration for BIS certification has been made online and simple.
- Though BIS has been running a hallmarking scheme for gold since April 200, the exercise has been voluntary so far.
- The aim of this move to make hallmarking compulsory is to ensure that customers are not cheated while buying gold products. This will also bring the Indian gold market in line with the global market standards.
- To ensure that the hallmarking is authentic, look for purity in carat and fitness, the BIS mark, the identification mark or the number of hallmarking centres, and the jeweller’s identity mark or number.
- Currently, there are 892 hallmarking centres across 234 districts in the country that hallmark gold of 28, 849 BIS registered jewellers.
- However, only around 40 per cent of gold jewellery is being hallmarked currently.
- This rule of hallmarking is currently implemented for jewellers and common customers can still sell their old gold jewellery without hallmark certification.
- Gold hallmarking is a purity certification of the precious metal and is voluntary in nature at present.
- According to the government, the hallmarking of jewellery/artefacts is required to enhance the credibility of gold jewellery and customer satisfaction through third party assurance for the marked purity/fineness of gold, consumer protection.
- This step is also expected to help develop India as a leading gold market centre in the world.
- The government noted that there has been a 25% increase in Assaying and Hallmarking (A and H) centres in the last five years.
- “The number of A and H centres has increased from 454 to 945 in the last five years. At present 940 Assaying and hallmarking centres are operative. Out of this 84 AHCs have been set up under government subsidy scheme in various Districts,” the release said.
- “Presently A and H Centre’s can hallmark 1500 articles in a day, the estimated hallmarking capacity of A&H Centre’s per year are 14 crore articles (Assuming 500 articles per shift and 300 working days),” it added.
- According to World Gold Council, India has around 4 lakh jewellers, out of this only 35,879 have been BIS certified.
What New Hallmarking means for you
- The hallmarking scheme has started with 256 districts of the country, which have assaying and hallmarking centres. As per the ministry, there has been 25 per cent increase every year in assaying and hallmarking centres in the last five years.
- At present, 943 assaying and hallmarking centres are operational in the country.
- According to Tiwari, jewellers with annual turnover upto ₹40 lakh will be exempted from mandatory hallmarking. Watches, fountain pens and special types of jewellery like Kundan, Polki and Jadau will also be exempted.
- He also said that export and re-import of jewellery as per Trade Policy of Government of India – Jewellery for international exhibitions, jewellery for government-approved B2B domestic exhibitions will not be hallmarked.
- According to government order, any manufacturer, importer, wholesaler, distributor or retailer engaged in selling precious metal articles has to mandatorily get registered with the BIS. The registration process will be one-time and there will be no fees will be charged from jewellers for it.
- Artisans or manufacturers who are manufacturing the gold jewellery on job work basis for the jewellers and are not directly related to sale to anyone in the chain are exempted for registration, the government said.
- Tiwari said there has always been a high demand from jewellers to increase the grades of gold purity for hallmarking. “Considering this, gold of additional carats i.e. 20, 23 and 24 will also be allowed for hallmarking,” said the BIS chief.
- The ministry in its release clarified that old un-hallmarked jewellery available in households can be sold to jewellers. It said that that jewellers can continue to buy back old gold jewellery without hallmark from consumer and in order to give adequate time to the manufacturers, wholesalers and retailers of gold jewellery, there would be no penalties till August end.
- BIS (Hallmarking) regulations were implemented with effect from June 14, 2018. According to BIS, hallmarking will enable jewellery buyers to make the right choice and save them from any unnecessary confusion while buying gold.
- The hallmarking of jewellery is required to enhance its credibility of gold jewellery and customer satisfaction through the third party assurance for the marked purity/fineness of gold, consumer protection, said BIS. This step will also help to develop India as a leading gold market centre in the world, it added.
Impact on the jewellers and the industry at large
Large jewellery retail chains such as Tanishq, Kalyan Jewellers, will not be impacted by the new rule as they already are running organised operations and hallmark their jewellery, say industry watchers.
Over 400 stores of Tanishq, Mia and Zoya, across 215 towns are registered under BIS and have the hallmarking license and 100 percent of the inventory being sold from all our stores is hallmarked.
The development, however, companies and experts believe make the industry more organised.
Mandatory hallmarking will standardise the purity of gold jewellery and take the industry towards being more structured as well as further push the ongoing shift of business and customers from the unorganised to the organised jewellery segment.
The small businesses will not be adversely affected due to the new rule as the government has exempted jewellers with an annual turnover of up to Rs 40 lakh. While the medium business, Hundekari of Kearney, will have enough time to make the transition as no penalty will be levied till August.
Some supply-chain constraints might emerge as the industry scrambles to comply with the new norms given the limited number of Assaying and Marking Centres but the government will ramp up these centres going ahead, experts believe.
Who has been exempted from Mandatory Hallmarking?
The government has exempted the difficult areas, which do not have a hallmarking and assaying centre near them, from the scheme as of now. These include six northeastern states, as well as Union territories like Jammu and Kashmir, Ladakh and Andaman and Nicobar.
The government has also relaxed mandatory gold hallmarking guidelines for jewellers with an annual turnover of up to Rs 40 lakh per annum so that small jewellers do not face problem in accessing assaying centres.
Besides small jewellers, the government has also exempted those who export and re-import jewellery as per the government’s trade policy, jewellery meant for international exhibitions as well as for government-approved B2B domestic exhibitions.
Manufacturer, importer, wholesaler, distributor or retailer engaged in selling precious metal articles have to mandatorily get registered with BIS for hallmarking.
However, artisans or manufacturers who are just making the gold jewellery on a job work basis for the jewellers and are not directly related to the sale to anyone in the chain are exempted from registration.
Why has Hallmarking been mandatory from 16 June?
The mandatory hallmarking protects the public against lower caratage and ensures consumers do not get cheated while buying gold ornaments and get the purity as marked on the ornaments.
The BIS has been running a hallmarking scheme for gold jewellery since April 2000. Around 40 percent of gold jewellery is being hallmarked currently. The government said there has been a 25 percent increase in assaying and hallmarking centres to 945 from 454 in the last five years.
According to Pramod Kumar Tiwari, director-general, BIS, the mandatory hallmarking of gold is a massive change taken to protect the interest of consumers.
Hallmarking should be done at the first point of sale which may be manufacturer, wholesaler, distributor or retailer,