Congress Needs Human Rights Assurances To Support Russia MFN Vote

Inside US Trade’s

There is a growing sense in Washington that members of Congress will need assurances on human rights if they are to agree to grant Russia permanent most-favored nation (MFN) status, which is necessary if U.S. companies are to fully benefit from Russia acceding to the World Trade Organization.

In a July 7 statement, House Foreign Affairs Committee Chairman Ileana Ros-Lehtinen (R-FL) argued that extending permanent MFN and ushering Russia into the WTO is “simply not an option” until Russia is pressed to improve its human rights record. A congressional aide said this sentiment is shared by other members of Congress.

According to an informed source, the White House opposes directly linking improvements in Russia’s human rights situation to Russia’s WTO accession, but since January has nonetheless been advancing the idea that Congress should consider separate human rights legislation this year.

The White House wants to head off a situation where Congress would put off a vote on extending permanent MFN status due to objections on human rights abuses or lack of democracy in Russia, this source said.

President Obama raised both human rights abuses and WTO accession in July 13 discussions with Russian Foreign Minister Sergey Lavrov, according to a White House statement, although that statement gave no indication that Obama directly linked the two issues.

In particular, Obama discussed the death of Sergei Magnitsky, a Russian lawyer who died in government custody after uncovering a massive tax fraud by Russian government officials. Obama also reaffirmed U.S. support of Russia’s efforts to complete its accession to the WTO this year, and discussed other issues as well, according to the White House statement.

Ros-Lehtinen has no direct jurisdiction over the MFN vote, but she could use her chairmanship to sway the House leadership to take her position, sources said. Alternatively, she could devise her own human rights bill that would fall under the jurisdiction of her committee.

In April, Mike McFaul, the White House National Security Adviser on Russia, said that members alarmed about Russia’s human rights record could back legislation that would penalize Russian officials found to have contributed to Magnitsky’s death and are involved in other gross human rights abuses (Inside U.S. Trade, April 22).

The bill in question is sponsored by Sen. Ben Cardin (D-MD) and would authorize the United States to impose a travel ban and financial sanctions on Russian individuals believed to have been directly involved in Magnitsky’s prison death. It would also ban U.S. visas and freeze U.S. assets of Russian individuals found to be directly involved in other gross violations of human rights, such as murder, torture or imprisonment.

Cardin’s bill currently has 18 co-sponsors, including fellow Finance Committee members Sen. Jon Kyl (R-AZ) — who also serves as the Senate Republican whip — and Sen. Robert Menendez (D-NJ). Senate Majority Whip Richard Durbin (D-IL) has also signed on to the bill. The measure is pending before the Senate Foreign Relations Committee.

In the House, a more limited bill is pending before the Judiciary Committee. The House bill would only apply visa bans and asset freezes to those directly involved in Magnitsky’s death but not other human rights violations.

The legislation may become a required trade off for some senators to support the administration’s push to get a vote on permanent MFN and the repeal of the Jackson-Vanik amendment in Congress, according to a congressional aide. Delay in moving this legislation may lead to a delay in the Jackson-Vanik vote, he said.

Passing this legislation could give political cover to members who are nervous about voting in favor of permanent MFN for Russia because they could also support a measure that addresses Russia’s human rights abuses.

The congressional aide acknowledged that the asset freeze may not have a large financial impact due to the fact that many Russian individuals in question do not have assets in the United States or could easily pull their assets out once they know they are subject to an investigation.

But it will put pressure on the European Union, which is also considering a similar policy for freezing assets and banning visas for questionable Russian individuals, to adopt a similar model. This is significant because many Russian individuals keep many of their assets in the EU and travel frequently to EU member states, this source said.

By banning the entry of Russian individuals to the United States, this source said the bill would make a strong symbolic statement to a country whose population is eager to immigrate to the United States and find opportunity here.

The White House is considering formally supporting the legislation in response to growing criticism in Congress over Russia’s human rights issues, but is facing opposition from the State Department, according to an informed source.

The State Department has been cautious toward the White House fully supporting Cardin’s bill, asking instead for a non-binding version or a “sense of the Congress” resolution, according to a congressional source.

State is the lead agency in the bill to carry out the visa ban and will work with the Treasury Department to freeze assets of individuals listed.

State has made it clear that it wants sufficient due process provisions to accompany any kind of asset freeze carried out by the Treasury Department, such as a verification process to make sure assets frozen truly belong to someone listed.

Additionally, State is concerned that the bill’s provision that would allow any member of Congress to submit a request for an individual to be investigated for possible sanctions under the law and require a response within 30 days might expose the department to unreasonable requests by congressional members wishing to make political statements.

A congressional source said that some of its objections could be addressed by having the legislation limit requests only to the chairmen and ranking members of the relevant committees and giving State 90 days to respond to a request, according to a congressional source.

The Sergei Magnitsky Rule of Law Accountability Act of 2011, S. 1039, is a reintroduction of a bill first proposed by Cardin last year but not pushed in the lame-duck session so as not to jeopardize the ratification New Strategic Arms Reduction Treaty (START), which Cardin supported.

The bill may have more traction this year not only because of Russia’s pending WTO accession but because many senators “went out on a limb” for the administration to approve New START despite human rights concerns at the end of last year.

Members of Congress this year were confronted by a spate of events this year that reflect poorly on Russia’s human rights record. These included the news that high-profile Russian prisoner Mikhail Khodorovsky was convicted a second time, extending his prison sentence to at least 2016, the congressional source said.

The 2003 imprisonment of Khodorovsky, a former Russian oil tycoon, has been criticized in the United States as a heavy-handed response to Khodorovsky challenging the power of then Russian President Vladimir Putin.

Additionally, Russia has stated that it will not honor the terms of New START if the United States pursues a missile defense program in Europe because Russia considers it a threat to its security. The terms of the treaty allow for the United States to pursue missile defense efforts, sources said.

The bill may also gain more support after Russia banned the formation of an opposition party this year and had, for a time, instituted a travel ban that prohibited two of the party’s organizers from leaving Russia. The travel ban was overturned last week, sources said, most likely in response to the fact that a travel ban was directly contradictory with the Jackson-Vanik amendment’s provisions on the free movement of people.

The Jackson-Vanik amendment is part of Title IV of the Trade Act of 1974 and makes MFN conditional on Russia’s emigration policy. For Russia the amendment was meant to pressure the country to allow the free emigration of its Jewish population but it applies to the movement of all people. If the amendment is repealed by Congress, it gives the president the authority to grant permanent MFN to Russia, which will allow the United States to take advantage of the tariff and trade commitments that Russia will make as part of its WTO accession.

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