President Barack Obama signed H.R. 6156 into law today, officially establishing permanent normal trade relations (PNTR) with Russia.
Much of what the bill does is iterated in its full title, the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of Law and Accountability Act of 2012. In addition to repealing the Jackson-Vanik amendment, a regularly ignored Cold War regulation that made U.S. preferential tariff rates on Russian products conditional on the country allowing Jews and other minorities to emigrate freely, the bill also normalizes trade relations with Moldova and gives the U.S. the ability to sanction Russian human rights violators according to the terms of the bill's so-called Magnitsky provisions, named after Russian lawyer Sergei Magnitsky who died in Russian prison while investigating allegations of large-scale theft on the part of Russian officials.
Normalizing trade relations with Russia became a priority once Russia officially joined the World Trade Organization (WTO) in August. According to the terms of Russia's WTO accession agreement, the country could increase tariffs on products entering the country from the U.S. until the U.S. normalized trade relations with its fellow WTO member. The presence of the Jackson-Vanik Amendment on U.S. books was considered abnormal, and Russia was, until now, within its rights to discriminate against American products.
President Obama's signature clears the bill's final hurdle and allows U.S. companies to take advantage of the newly expanded market access generated by Russia's WTO membership.
“The United States strongly supported Russia’s accession to the WTO, because it is in the interest of our exporters and the Americans they employ to bring Russia more fully into the global trading system,” said U.S. Trade Representative Ron Kirk. “With the signing of this legislation, American businesses and workers are closer to enjoying the full economic benefits of Russia’s WTO commitments.”
- Jacob Barron, CICP, NACM staff writer