August 21, 2012 / 6:43 PM / 6 years ago

U.S. business hopeful Congress passes Russia trade bill in September

WASHINGTON (Reuters) - A U.S. business group on Tuesday said they were hopeful Congress would approve a bill to upgrade U.S. trade relations with Russia after it returns from a month-long break and warned that U.S. companies would lose business if lawmakers don’t act.

Dan Flaherty, vice president at the National Foreign Trade Council, said the group was gearing up its lobbying efforts for a vote in the House of Representatives as early as September 12, which it hopes will be followed by quick Senate action.

If not, U.S. exporters will be left at a significant disadvantage to competitors in Europe, Asia and elsewhere around the world after Russia formally enters the World Trade Organization on Wednesday, Flaherty said.

“Our European friends are already in the market in a major way. (Failing to approve the Russia trade bill) is an invitation for them to solidify and expand their presence in areas where we would be more competitive,” he said.

Congress is under pressure to approve “permanent normal trade relations” with Russia by repealing a Cold War provision known as the Jackson-Vanik amendment, which ties normal U.S. tariff rates for Russia to emigration issues.

The White House has judged Russia to be in compliance with Jackson-Vanik for nearly two decades, but the measure remains on the books and is at odds with WTO rules requiring members to provide each other “unconditional” normal trade relations.

Business groups, which have been working for months to win approval of PNTR, are concerned the issue could be delayed until after the November presidential and congressional elections or even into 2013, if lawmakers don’t act quickly in September.

In Geneva, WTO Director General Pascal Lamy told Reuters he was optimistic Congress would approve PNTR in the coming weeks because “if U.S. was not to do this, this probably would be a disadvantage for U.S. business.”

Flaherty told reporters he understood Republican leaders in the House of Representatives planned to bring up the Russia PNTR bill on September 12 under a procedure usually reserved for non-controversial legislation.

The bill is expected to be combined with human rights legislation known as the “Magnitsky bill,” and would require a two-thirds vote for approval, instead of a simple majority, because of the expedited approval procedure, he said.

House Majority Leader Eric Cantor, a Republican, said in early August the House was prepared to vote on PNTR and the Magnitsky bill when lawmakers return “should the Senate and President (Barack Obama) commit to support passage before the end of September.”

A spokesman for Cantor on Tuesday referred reporters to that statement and said he could not confirm that the vote had been set for September 12.

A spokesman for Senate Majority Leader Harry Reid, a Democrat, did not immediately respond to a query on the possibility of Senate action in September.

Bill Reinsch, president of the National Foreign Trade Council, estimated that as many as 80 House Democrats would have to join with Republicans to get to the approximately 290 votes needed for approval in that chamber.

A House vote in early September would put pressure on the Senate to take up the issue in the few legislative days left before the elections, he said.

Reporting by Doug Palmer; Editing by Eric Beech

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