Industry News

WTO to Vote on Russian Membership
November 10, 2011

On November 10, 2011, following Georgia and Russia signing an agreement regarding trade monitoring in their disputed border region, the World Trade Organization’s (WTO) Working Party granted its approval and finalized terms for Russia’s membership. Russia and Georgia signed a Swiss-brokered agreement on November 9th allowing independent third parties, selected by the Swiss, to monitor trade across the borders of Abkhazia and South Ossetia, the disputed regions Russia and Georgia fought a war over in 2008. The Working Party’s approval clears the way for a vote on Russia’s WTO membership at the WTO’s ministerial gathering in mid-December. Russia would then have six months to ratify its membership, which would take effect thirty days later.

Russian membership in the WTO would not automatically grant Russia permanent normal trade relations with the United States. The Jackson-Vanik amendment, which is part of Title IV of the Trade Act of 1974, prevents normal trade relations with Russia. Should the amendment be repealed, the President would have the authority to grant Russia permanent Most Favored Nation (MFN) status, allowing the United States to share in the benefits of Russia’s WTO commitments. Such benefits would include the ability to challenge Russia at the WTO Dispute Settlement Body. Should the amendment remain in place when Russia becomes a WTO member, the U.S. would be forced to apply a non-application clause, placing the United States at a competitive disadvantage to countries that grant Russia permanent MFN status.

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