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By Len Bracken
House Ways and Means Chairman Dave Camp (R-Mich.) announced April 26 the scheduling of a hearing in his committee on granting permanent normal trade relations (PNTR) to Russia, and he opposed inclusion of human rights provisions in legislation terminating the application of Title IV of the Trade Act of 1974.
Congress is considering lifting the application of Title IV to Russia so the president would be allowed to grant PNTR, which is referred to as most favored nation (MFN) status in the World Trade Organization.
Camp announced the Ways and Means Committee hearing scheduled for June in a speech at the Center for Strategic and International Studies. He criticized the administration for showing “little outward effort” with regard to Russia and said he does not favor including human rights provisions in a bill lifting Title IV, as this would replace one condition with another condition.
Title IV contains the Jackson-Vanik amendment, which was designed to link trade to Jewish emigration from the former Soviet Union through an annual review in order to authorize normal trade relations status. Camp was referring to this condition of an annual review being replaced by another if human rights provisions were included in the bill lifting application of Title IV.
“You just have to remember that PNTR cannot contain conditions,” Camp said, referring to WTO rules. He added that he was open to another measure related to human rights moving in tandem or along with Title IV legislation.
In accordance with WTO rules requiring the extension of unconditional MFN status, the United States invoked nonapplication of Russia's accession agreement in December, when the Eurasian country was invited to join the organization (243 ITD, 12/19/11).
Nonapplication of Russia's accession protocol will go into force and U.S. firms will not receive its benefits unless PNTR is granted by presidential proclamation before Russia joins the WTO, which will be on or before Aug. 22.
It is noteworthy that the chairman referred to the human rights provisions under consideration as constituting a condition, even though they do not contain an annual review but involve visa denials and asset freezes for those involved in human rights abuses.
Legislation terminating the application of Title IV to China in 2000 contained numerous reporting requirements and the creation of two commissions, which were not conditions under WTO rules, but these provisions did not require the executive branch to take actions. Advocates of the human rights legislation argue the provisions could be contained in the Title IV measure without constituting “conditions” but also favor keeping the bills separate.
The administration had reportedly favored adding acceptable elements of the Justice for Segei Magnitsky Rule of Law Accountability Act of 2011 (S. 1039) to the Title IV bill despite its concerns about maintaining the link between human rights and trade. Legislation has yet to be introduced.
The administration and industry advocates of PNTR recognized that lawmakers on both sides of the aisle have signaled a replacement for Jackson-Vanik must be in place for them to allow the president to grant PNTR (73 ITD, 4/17/12).
The administration has been working closely with the bill's sponsor, Sen. Benjamin Cardin (D-Md.), on refining the measure. Drafts have been circulated to the business community, which is waiting for the final product, however the bill will likely continue to be massaged.
Russian officials have said that they are planning a “symmetrical” response to the Magnitsky bill, which is named after Russian lawyer who was working for a U.S. law firm when he died in prison following the denial of medical treatment.
Camp said that he would like the administration to be more assertive during the month of May to build confidence and provide leadership on the economic and noneconomic issues with Russia. He contrasted the administration's lack of effort on PNTR with its hard work on the Trans-Pacific Partnership negotiations.
The administration currently has an automotive-related trade mission under way in Russia involving 12 U.S. companies and may, according to informed sources, be able to elicit intellectual property enforcement actions by Russian officials that will be reflected in the Special 301 report due April 30 from the Office of the U.S. Trade Representative. These two issues along with agricultural regulations have often been cited by lawmakers as points of contention on the trade front. Iran and Syria stand out as areas of concern in the foreign relations sphere.
The Ways and Means chairman described the U.S. relationship with Russia as “complex” but the economic benefits of granting PNTR as being “clear,” namely greater opportunities for U.S. businesses, farmers, and ranchers to sell goods and services to Russia.
“In granting PNTR, we would give up nothing--not a single U.S. tariff--but we would obtain a powerful new enforcement tool and important rights, while bringing our two countries closer on multiple fronts,” Camp said.
Camp said he shares the view of many lawmakers that Russia poses significant problems on foreign policy and human rights issues. He stressed, however, that holding up PNTR because of nontrade concerns does not increase U.S. leverage in addressing those concerns.
“As you well know, Russia continues to have its skeptics on Capitol Hill, and whispering presidents inadvertently heard around the world have not made our task any easier,” Camp said. The Michigan lawmaker was likely referring to March 26 remarks made by President Obama to Russian President Dmitry Medvedev in Seoul about having more “flexibility” on defense issues after the U.S. presidential election.
Camp called on the administration to intensify its efforts with regard to Russia and make its best case as to why Congress should act this year on PNTR.
“It is time for the White House to get out front on this issue,” Camp said. “And, I will do the same.”
Industry and congressional sources told BNA the administration has been active on Capitol Hill, particularly with the committees of jurisdiction--Ways and Means and Senate Finance. The lack of a bill was cited by an industry source as impeding progress in garnering support for PNTR. As with other legislative issues, such as reauthorization of the Export-Import Bank, sharp divisions among House Republicans are anticipated with regard to Russia, according to a Capitol Hill source close to the issue.
Camp did acknowledge that his committee is engaged with the Office of the U.S. Trade Representative on issues that have been highlighted by ranking member Rep. Sander Levin (D-Mich.), such as intellectual property rights violations and market access for U.S. automobiles.
“I hope to see more progress,” Camp said, “but I think our ability to address these issues will be much stronger once Russia is in the WTO--then we'll have access to dispute settlement procedures that we don't have access to now.”
In a same-day response, Levin said he welcomed the scheduling of a hearing, noting that the Senate is already preparing legislation to address outstanding issues with regard to normalizing trade relations with Russia.
“There has been no such effort by the House majority to date,” Levin said in a statement. “Granting permanent normal trade relations with Russia clearly has commercial advantages; there are other issues that have been raised and are being discussed in the Senate and need bipartisan consultation in the House. That is the constitutionally mandated responsibility of the House Ways and Means Committee and it needs to be exercised actively.”
Levin said he looks forward to working with Camp in putting together a package that strengthens their hands in addressing outstanding issues.
By Len Bracken
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