An antitrust case in the diamond industry: The United States v. the De Beers cartel (1948)

Véronique Pouillard

Business History, 2025, vol. 67, issue 5, 1294-1314

Abstract: This paper examines an antitrust case filed in 1945 by the United States Department of Justice against the diamond cartel led by the South African firm De Beers. By the end of the interwar period, the Belgian Congo firms in the cartel were the largest producers of industrial diamonds in the world. Demand for this product had stagnated during the interwar period but increased during World War II, as industrial diamonds were needed by the arms industry. This resulted in a partial shift of De Beers’ production away from jewellery diamonds to support the allied war effort. This article focuses on the background of the case and engages with reasons why the Department of Justice filed the complaint. It examines the De Beers production historically, before investigating the lawsuit’s arguments. The strategic importance of the US diamond stockpile was the central issue. The paper considers the historiography of the diamond industry and discusses historians’ hypotheses regarding the case. Although dismissed in 1948, the case resulted in changes in the cartel’s organisation and in greater scrutiny of De Beers’ activities. The case marks a turning point for the cartel, which then entered an adaptation phase that ensured its survival until nearly the end of the century.

Date: 2025
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DOI: 10.1080/00076791.2024.2340621

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