Senate Finance poised to approve Russia trade bill
Senators were poised Wednesday to clear the first hurdle to extend permanent normal trade relations to Russia, but plenty of uncertainty remains.
The Senate Finance Committee is expected to easily approve a measure combining a repeal of Jackson-Vanik, an obsolete Cold War-era provision, along with a human-rights measure that would punish Russian officials involved in the death of lawyer Sergei Magnitsky, who died in prison.
“By enacting PNTR together with the Magnitsky bill, we are replacing Jackson-Vanik with legislation that addresses the corruption and accountability issues that Russia confronts today,” Senate Finance Chairman Max Baucus (D-Mont.) said.
The show of bipartisan support — Baucus and ranking member Orrin Hatch (R-Utah) hammered out the compromise — could boost the bill’s chances of getting through Congress before lawmakers leave for a month-long August recess.
Russia is on track to join the World Trade Organization next month. All that is left for its accession is for President Vladimir Putin to sign the package, which passed through Russia’s upper chamber on Wednesday. Once Putin signs, the clock begins ticking, and Russia will become a member of the WTO within 30 days.
Still, there are plenty of pieces in play with no resolution in sight.
Lawmakers are divided over whether to pass a clean measure repealing the 1974 Jackson-Vanik amendment, while also holding Russia accountable for what lawmakers say is a dismal human-rights record.
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Senate Finance Reports Measure on PNTR For Russia, Moldova; Magnitsky Act Included
Key Development: Magnitsky bill included, vote is unanimous.
Next Steps: Kirk, Baucus, Camp to meet July 19.
The Senate Finance Committee July 18 unanimously reported legislation designed to allow the president to grant permanent normal trade relations (PNTR) to Russia and Moldova.
The bill would also replace human rights sections of the Trade Act of 1974 with provisions, named after deceased tax attorney Sergei Magnitsky, targeting corrupt government officials in Russia and elsewhere.
In his opening remarks, Chairman Max Baucus (D-Mont.) noted that the measure will make permanent the normal trade relations the United States already has had with Russia for the past 20 years and should double U.S. exports to Russia in five years.
The opportunities for increased trade with Russia are related to the massive Eurasian country joining the World Trade Organization in August after a 19-year accession process. The upper house of the country’s legislature July 18 approved the WTO accession package (see related report).
Baucus said hundreds of companies and trade associations have come out in favor of PNTR, as well as U.S. and Russian Jewish groups, including the National Conference on Soviet Jewry and the American Israel Public Affairs Committee.
Section 402 of the Trade Act, the so-called Jackson-Vanik Amendment, requires an annual review of respect for emigration rights that was originally intended to support Jewish emigration from the former Soviet Union. The bill would terminate the application of this section along with the others in Title IV.
The annual review constitutes a condition according to WTO rules and is therefore at odds with the organization’s core principle of unconditional most favored nation (MFN) status, which is the term for PNTR used in international treaties. Absent MFN, Russia is not required to grant the terms of its accession package to the United States and U.S. companies.
Baucus noted that Moldova is the only WTO member with which the United States does not have permanent normal trade relations. “Like Russia,” Baucus said, “Moldova has allowed freedom of emigration for many years, and Moldova joined the WTO in 2001.”
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Senators Bungled Anti-Magnitsky Road Show
Last week, a delegation of Russian senators traveled to Washington to make a last-ditch attempt to derail the Sergei Magnitsky Rule of Law Accountability Act. By the time they were finished, the trip had turned into a fiasco, highlighting the need for the law they so vehemently oppose.
The Magnitsky act seeks in part to ban entry to the United States and freeze the U.S. assets of the people responsible for the illegal arrest, torture and murder of my former law partner, Sergei Magnitsky. It also seeks to do the same to any Russian government official who abuses his position to attack anti-corruption activists, journalists and people who defend fundamental human freedoms.
The Kremlin is categorically opposed to the Magnitsky act and argues that punishment of corrupt Russian officials must be left to the Russian government. It is adamant in asserting that its criminal justice system works and should be trusted by other nations. To demonstrate why there is no need for the Magnitsky act, the senators said the purpose of the trip to Washington was to present findings of a new and independent Federation Council investigation of the Magnitsky affair.
The timing of the announcement was not coincidental. The Magnitsky act is sailing through hearing after hearing on Capital Hill. There is huge inertia to pass it before the summer recess. Just about the only thing that could derail the act is if the Russians carried out a legitimate investigation and started prosecuting their own corrupt officials.
But the composition of the Russian delegation was disquieting. It was headed by Vitaly Malkin, whose net worth is estimated to be more than $10 million and who was previously named by the Canadian government in court proceedings as “a member of a group engaging in organized or transnational crime.” Malkin has been banned from entering Canada. A politician accused of skimming $48 million off a debt-reduction deal with Angola and who enjoys immunity from prosecution in Russia was probably not the best choice to head a delegation determined to prove that the Russian government is capable of punishing its own corrupt officials.
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Senate panel approves normal trade relations with Russia, adds human rights provision
A Russia trade bill that could double U.S. exports to Russia but complicate already frosty relations with the former Communist superpower advanced in the Senate on Wednesday.
Lawmakers rejected a provision that would have required the president to certify that Russia is no longer supplying arms to Syria.
The Senate Finance Committee combined the trade measure with a bill to punish Russian human rights violators.
The committee’s unanimous vote to lift Cold War trade restrictions and establish permanent normal trade relations with Russia came against a background of strong objections to Russia’s poor human rights record, its threats against U.S. missile defenses in Europe, its failure to protect intellectual property rights, its discrimination against U.S. agricultural products and most recently its support for the Assad government in Syria.
Enacting permanent trade status is necessary if U.S. businesses are to benefit from the lowering of trade barriers that will take place when Russia enters the World Trade Organization next month.
Finance Committee Chairman Max Baucus, D-Mont., said current U.S. exports to Russia, about $9 billion a year, could double in five years if trade relations are normalized.
“There is no time to waste. America risks being left behind,” Baucus said. “If we miss that deadline, American farmers, ranchers, workers and businesses will lose out to the other 154 members of the WTO that already have PNTR (permanent normal trade relations) with Russia.” U.S. imports from Russia last year were four times the export level.
Getting the trade bill through Congress has been a top priority for business and farm groups, which see it as a jobs creator and a boost to the economy. “Without PNTR, U.S. companies and workers will be at a distinct disadvantage in the Russian market as our competitors in Europe, Asia and elsewhere begin to lock in sales and long-term contracts,” said Caterpillar Inc. chairman and CEO Doug Oberhelman, who also chairs the Business Roundtable’s International Engagement Committee.
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Senate Panel Advances Trade Bill With Russia
A Senate committee advanced a measure on Wednesday to normalize trade relations with Russia for the first time since the fall of the Soviet Union while also sanctioning officials implicated in human rights abuses.
With the measure passed in the Senate Finance Committee on a unanimous vote, lawmakers dispensed with two decades of resistance to lifting cold war-era restrictions under the so-called Jackson-Vanik law. But senators insisted on the human rights sanctions to send a message to President Vladimir V. Putin as Moscow under his new term cracks down on dissent.
The trade move has been a priority of President Obama’s as he seeks to improve Russian-American relations, but his administration unsuccessfully lobbied against adding the sanctions, arguing that it was already taking action on human rights. The sanctions have provoked deep anger in Moscow at a time when Mr. Obama has been seeking help from Mr. Putin in resolving the crisis in Syria.
Russian lawmakers visited Washington last week to lobby against the sanctions, and on Tuesday, Moscow repeated its plan to respond tit for tat.
“There is a whole range of situations in the U.S. where senior and other officials of this country’s ministries and agencies are responsible for systematic and severe human rights violations,” Sergei Ryabkov, Russia’s deputy foreign minister, told the Interfax news agency.
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Russia trade and human rights legislation advances, but time running short
The Senate Finance Committee unanimously approved today a bill to grant Russia Permanent Normal Trade Relations (PNTR) status as well as a bill to punish Russian human rights violators, but time is running out to pass the legislation through the full House and Senate.
Committee Chairman Max Baucus (R-MT) called on Congress to quickly pass the bills before lawmakers leave town at the end of this month for the long August recess. Russia’s accession to the WTO is imminent, and unless the United States grants Russia PNTR status, U.S. businesses won’t be able to take advantage, he argued.
“There is no time to waste; America risks being left behind,” Baucus said. “If we miss that deadline [of Russia’s WTO accession], American farmers, ranchers, workers and businesses will lose out to the other 154 members of the WTO that already have PNTR with Russia. American workers will lose the jobs created to China, Canada and Europe when Russia, the world’s seventh largest economy, joins the WTO and opens its market to the world.”
Baucus also trumpeted the fact that the PNTR bill is now officially joined with the Senate version of the Sergei Magnitsky Rule of Law Act of 2012, which passed the Senate Foreign Relations Committee unanimously in June. The bill imposes restrictions on the financial activities and travel of foreign officials found to have been connected to various human rights violations in any country. The House version of the bill, approved by the House Foreign Affairs Committee earlier this month, targets only Russian human rights violators.
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US Senate Committee Ties Jackson-Vanik to Magnitsky Bill
The United States Congress finance committee has linked a draft bill on repealing the Jackson-Vanik Amendment and a change in Russia’s status to a free trade nation to the draft “Magnitsky bill,” the committee said on Wednesday.
A Senate vote on the joint law will take place in the next few hours.
“Committee Chairman Baucus released a modified mark of his bill to establish permanent normal trade relations with Russia and remove Russia from the 1974 Jackson-Vanik amendment,” a source in Washington told RIA Novosti. “The mark includes the Magnitsky Act, as passed by the Senate Foreign Relations Committee.”
The text of the joint bill also has “small alterations,” on electronic trade, the source added.
The introduction of the combined bill to the committee is a technicality, as Baucus presented his draft bill to the Senate on July 12, and on July 14 a source in the committee administration confirmed to RIA Novosti that it would be this joint bill which would be put to the vote on Wednesday.
Several senators have already expressed strong support for the bill.
The new bill is a response to the demands of a majority of lawmakers for a review of legislation affecting trade and human rights issues, including some laws affecting trade with Russia.
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Russia Trade Bill Set to Advance in U.S. Senate, But Passage by August Recess Uncertain
A Senate panel appears headed to back Wednesday the lifting of trade restrictions on Russia, but the White House faces an uphill battle in its effort to win congressional approval before its long-time geopolitical rival joins the World Trade Organization as expected next month.
Several senators and private-sector supporters of legislation to approve permanent, normal trade relations with Russia said the bill is likely to clear its first major hurdle, by winning the backing of the Senate Finance Committee.
But a number of senators cast doubt on whether Congress can pass the bill before lawmakers leave town in early August for recess, raising the risk that U.S. companies will be put at a competitive disadvantage in trying to win Russian business. Rising tensions with Russia over Syria, Iran and human rights issues are complicating passage, with senators of both parties looking to attach measures to the trade bill to punish Russian human-rights violators.
“I’m very concerned about the human rights abuses and the bad behavior of Russia,” said Sen. John Cornyn (R., Texas.) Still, he and Sen. Jon Kyl (R., Ariz.), the minority whip, predicted the Finance Committee would approve the bill.
“I think things are fairly well resolved, that the (trade bill) would be accompanied by the Magnitsky legislation,” said Mr. Kyl. He was referring to a measure, named after a Russian lawyer who died in prison after accusing Russian government officials of fraud, that would freeze assets and deny visas to Russian human-rights abusers.
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Russia offers economic opportunity
U.S. exports to Russia total more than $9 billion per year. Repealing Jackson-Vanik and establishing PNTR could double that number in just five years, according to one recent study. That could mean thousands of new jobs across every sector of our economy. With the Russian economy’s impressive growth — it’s expected to outgrow Germany’s by 2029 — the long-run gains would be even greater.
Make no mistake, Russia is not without its problems — and they are stark in the foreign policy arena. Its support for the regimes in Syria and Iran remains an obstacle.
The death of anticorruption lawyer Sergei Magnitsky also highlights troubling human rights problems. A bill known as the Magnitsky Act, sponsored by our colleagues Sens. Ben Cardin (D-Md.) and McCain , aims to address these human rights issues by sanctioning those responsible for Magnitsky’s death. It’s a crucial part of the debate surrounding our relationship with Russia — and should be approved together with PNTR.
It is important to understand that this debate is not a choice between improving conditions in Russia and increasing U.S. exports. These are not opposing goals — indeed, they support each other.
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To learn more about what happened to Sergei Magnitsky please read below
- Sergei Magnitsky
- Why was Sergei Magnitsky arrested?
- Sergei Magnitsky’s torture and death in prison
- President’s investigation sabotaged and going nowhere
- The corrupt officers attempt to arrest 8 lawyers
- Past crimes committed by the same corrupt officers
- Petitions requesting a real investigation into Magnitsky's death
- Worldwide reaction, calls to punish those responsible for corruption and murder
- Complaints against Lt.Col. Kuznetsov
- Complaints against Major Karpov
- Cover up
- Press about Magnitsky
- Bloggers about Magnitsky
- Corrupt officers:
- Sign petition
- Citizen investigator
- Join Justice for Magnitsky group on Facebook
- Contact us
- Sergei Magnitsky
