Two Russia PNTR Bills Introduced in Senate; Neal Predicts Momentum for Action
A bipartisan bill was introduced March 1 in the Senate to revoke normal trading relations with Russia "and other countries that invade sovereign nations." The next day, the chairman of the Senate Finance Committee introduced his own version, which echoes the House bill, in that it not only revokes permanent normal trade relations, it also suggests that the U.S. delegation to the World Trade Organization work to convince other countries to expel Russia from the WTO.
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Sen. Rob Portman, a former U.S. trade representative and Republican from Ohio, said in a press release about his No Trading With Invaders bill, “Countries who wantonly invade others -- and democracies no less -- do not deserve the benefits of unlimited access to our economy. Whether that be Russia invading Ukraine today, or China invading Taiwan in the future, we need to have tools in place to swiftly punish acts of aggression. I urge my colleagues to quickly pass this bipartisan bill, to show Russia the consequences of its decision to invade Ukraine.” His co-sponsor, Sen. Ben Cardin, D-Md., emphasized the permanent reauthorization of the Magnitsky Act, which governs sanctions over human rights abuses and corruption. The press release noted that Serbia's and Montenegro's normal trading relations were revoked during the Yugoslavian civil war. They have since returned to most favored nation tariffs.
Finance Committee Chairman Sen. Ron Wyden, D-Ore., called his bill the No Most Favored Nation Trading with Russia Act. “Putin’s unjustified, unprovoked and appalling invasion of Ukraine shows he doesn’t believe international laws apply to Russia. You don’t get to do that and still benefit from normal trade relations,” Wyden said in a press release. “I urge my colleagues to set partisanship aside and quickly revoke Russia’s most-favored-nation trade status to send a clear message to Putin that the invasion of Ukraine will have devastating consequences for his regime.” Oil is the top export to the U.S. and removing PNTR would double the tariff per barrel.
House Ways and Means Committee Chairman Richard Neal, D-Mass., told International Trade Today that his staff is examining Rep. Earl Blumenauer's proposal to end Russia's PNTR, and said, "He's headed in the right direction." Neal said he talked to Wyden the night before about his bill, and said he's hoping for coordination across the Capitol and between the parties. "It would be a temporary suspension," he added. "I think there's a lot of interest," and that could drive momentum for the bills.
Simon Lester, an international trade law blogger, noted that the Portman bill is also temporary. After a presidential determination that a country "has committed an act of aggression in violation of international law, that the President does not consider to be a legitimate act of self-defense, against a WTO member," then PNTR is ended, and imports will be subject to the rates in Column 2 of the Harmonized Tariff Schedule. "Normal trade relations can be restored if acts of aggression stop and sovereignty and territorial integrity have been restored," Lester wrote.
On a related Russia-trade proposal, President Joe Biden was asked by reporters on March 2 if he was considering banning Russian oil imports, and Biden replied that "nothing is off the table."