It is necessary to establish order in the gold market.

(Baonghean) - According to Circular No. 22/2013/TT-BKHCN of the Ministry of Science and Technology (Circular 22), from June 1, 2014, gold trading businesses are required to comply with regulations on disclosing applicable standards for gold products, such as: stamping codes, gold content, gold purity, etc., on each product before circulation on the market. However, the effectiveness of implementation in practice has not been high so far.

Historically, the market for gold jewelry and fashion handicrafts nationwide, and particularly in our province, has operated quite freely, with each business and trading unit having its own inconsistent standards. In Nghe An province, there are over 100 gold and jewelry businesses in operation. Immediately after Circular 22 was issued and came into effect, while some reputable businesses proactively implemented the regulations, many others either did not comply or only did so passively and superficially. This affects the competitiveness of products with accurately declared gold content compared to gold products whose quality does not match the declared specifications.

Kim Thanh Huy, the owner of a gold and silver business on Cao Thang Street, said: “Currently, not only my store but most gold shops in the city still have a lot of unsold inventory. If we apply the new standards immediately, it will be very difficult to meet them. I think it will take some time before we can implement them.” This sentiment was also shared by many other small businesses in the province. According to these businesses, many jewelry products currently have a lower gold purity than advertised and need to be adjusted to comply with the new regulations. A representative from Kim Dung Thong business said: “I am aware of the State's Circular 22 on gold quality management because I recently attended a training session organized by the authorities. Currently, we have listed the gold purity on some of our products; however, we are concerned about the large amount of unsold inventory and will try to implement it in the near future.”

A gold shop on Le Loi Street (Vinh City). Photo: Hai Yen

According to inquiries at gold shops in Vinh City, almost all gold shops are currently lowering the gold purity, but selling it at the price of full-purity products. However, most small gold shops do not engrave the gold purity onto the jewelry; instead, they mostly engrave their own shop's symbol, claiming that the purity is already stated on the receipt given to the customer and therefore not printed on the product. Observations at several gold shops on Cao Thang Street, in the Vinh market area, show that even though the same 75% gold jewelry is being lowered in purity, the selling price varies from place to place. For example, on October 9, 2014, the same 75% gold jewelry product had a listed buying price of 1,840,000 VND/tael and a selling price of 2,340,000 VND/tael at one store, but at another gold shop the buying price was 1,606,000 VND and the selling price was 2,345,000 VND/tael. Some other stores had a difference in buying prices ranging from 50,000 to 150,000 VND/tael.

The gold jewelry market is a large market directly linked to the interests and lives of the majority of people due to the habit of buying gold as a store of value. Therefore, consumers who buy gold at one store but then sell it at another store suffer losses because of the gold's purity. According to Circular 22, the allowable error margin is only 0.1-0.3%. However, research in the gold market reveals that the current error margin in most gold shops is typically 1-3%, meaning that 99.99% pure gold may only be 96.99% pure (an error of 3%). Listing and labeling the gold content on products, as per Circular 22, will prevent consumers from being misled when buying gold that doesn't match its value. Ms. Nguyen Thi Yen, from Hung Dung ward (Vinh City), said: “I heard people say that gold shops often reduce the gold purity to make a profit. People like us, when buying gold, often don't know or know but have no way to verify it. So when I learned about the new government regulations on managing gold content at gold businesses, I hope they will be implemented soon so that people can feel secure and buy gold of the correct quality.”

However, many issues remain that both businesses and the public are concerned about, such as how to handle gold jewelry circulating in the market that does not meet the required purity standards, and which unit is responsible for standardizing equipment for measuring gold content. Regarding this, Mr. Phan Ngoc Quang, representative of the Nghe An Provincial Department of Standards, Metrology and Quality, stated: “When standards are standardized and control is more thorough, it will limit the inconsistent quality and price of gold in different places as is currently the case. This will not only ensure the rights of consumers but also create healthy competition among businesses. In the coming time, the Department will actively conduct propaganda, dissemination, training, and coordinate inspections of businesses trading in gold jewelry and handicrafts. If a product is identified as suspicious of its purity, the Department will take samples for testing at a qualified testing center under the General Department of Standards, Metrology and Quality.”

It can be said that Circular 22 on measurement management in the gold business is the legal basis for establishing order in the gold jewelry and handicraft market and strengthening consumer protection. To effectively implement Circular 22 and ensure state management in the province, in addition to the unified criteria and coordinated implementation by relevant agencies, proactive cooperation from numerous gold trading and manufacturing businesses in the area is also necessary.

Thanh Binh