House committee approves normal trade with Russia

July 26, 2012 - 2:44 PM

WASHINGTON (AP) — A House committee on Thursday approved legislation to end Cold War restrictions and normalize trade with Russia as U.S. business groups pressed for quick congressional action.

Russia formally joins the World Trade Organization on Aug. 22, and that will lower barriers on imports. But if Congress doesn't remove trade restrictions left over from the days of the Soviet Union, U.S. companies will not be able to take advantage of an improved trading environment in Russia.

The House Ways and Means Committee, by a voice vote, approved the bill to establish permanent normal trade relations with Russia. The measure repeals the Jackson-Vanik Act of 1974 that limited trade with the Soviet Union because of its policies of restricting the emigration of Jews and other minorities.

The Senate Finance Committee took similar action last week, but it is not clear whether the full House and Senate will act before Congress leaves at the end of next week for its August recess.

"If Congress fails to act this summer, it will have missed an immediate opportunity to support the U.S. economy and American jobs," said Doug Oberhelman, chairman of Caterpillar Inc. and chairman of the Business Roundtable's international engagement committee.

The trade bill is thought to enjoy solid support, but its progress through Congress has been slowed by Russia's human rights record and its policies considered by many in Congress to be anti-American. Those include threats against U.S. missile defense systems in Europe and its support of the Assad government in Syria.

Both House and Senate lawmakers have demanded that the trade bill be tied to a bill that would punish Russian government officials determined to be involved in human rights violations. The Senate bill does that, combining the trade bill with legislation named after a Russian lawyer, Sergei Magnitsky, who died in a Russian prison in 2009, allegedly after being tortured. The bill would subject those involved in the Magnitsky case and other human rights violators to denials of visas and the freezing of assets in the United States.

The House committee did not have the jurisdiction to take up the Magnitsky bill, but the chairman, Rep. Dave Camp, R-Mich., said he and the top Democrat on the committee, Rep. Sander Levin of Michigan, supported joining the two bills on the House floor.

"While it makes no sense to allow our competitors to get a leg up, we also recognize Russia must change its ways," Camp said.

The United States currently exports about $9 billion worth of goods to Russia every year and experts say that could double in five years if U.S. businesses had access to lower tariffs, greater assurances that intellectual property would be protected and the removal of other obstacles to investment.

The bill also establishes permanent normal trade relations with Moldova, a former Soviet republic that joined the WTO in 2001 and is the only WTO member that does not have permanent trade status with the United States.