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Russia Clears Last Hurdle to WTO Accession but U.S. Lawmakers Raise Concerns

Friday, November 04, 2011
Sandler, Travis & Rosenberg Trade Report

Press sources indicate that Russia has signed off on a deal with Georgia that represents the last hurdle to concluding Moscow’s 18-year effort to join the World Trade Organization. According to the Financial Times, under this agreement “independent third parties [will] supervise trade across the borders of Abkhazia and South Ossetia, the two breakaway regions that have been occupied by Russian troops since” a brief war between Russia and Georgia in 2008. Russian officials said “some little technical details” still have to be resolved, but the WTO could approve Russia’s membership by the end of the year and it could become official a few months after that.

For U.S. companies to take full advantage of the concessions Russia has made as part of its accession bid, Congress would have to repeal the so-called Jackson-Vanik Amendment, thus allowing the president to grant permanent most-favored-nation status to goods imported from Russia. However, a number of lawmakers and trade organizations have urged caution in considering such a move and urged U.S. officials to first make sure that several issues of concern are sufficiently addressed. These include protection of intellectual property rights, Russia’s commitment to join the Information Technology Agreement (which provides duty-free treatment for trade in information technology products among member countries), market access restrictions for U.S. agricultural products, and the impact of Russia’s auto investment regime on U.S. automobile and auto parts companies.

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