[WPRT 106-15]
[From the U.S. Government Publishing Office]
106th Congress WMCP:
2d Session COMMITTEE PRINT 106-15
_______________________________________________________________________
SUBCOMMITTEE ON TRADE
OF THE
COMMITTEE ON WAYS AND MEANS
U.S. HOUSE OF REPRESENTATIVES
__________
WRITTEN COMMENTS
ON
H.R. 4782, EXTENDING
UNCONDITIONAL NORMAL TRADE
RELATIONS TO GEORGIA
[GRAPHIC] [TIFF OMITTED] TONGRESS.#13
JULY 11, 2000
Printed for the use of the Committee on Ways and Means by its staff
__________
U.S. GOVERNMENT PRINTING OFFICE
68-271 WASHINGTON : 2000
COMMITTEE ON WAYS AND MEANS
BILL ARCHER, Texas, Chairman
PHILIP M. CRANE, Illinois CHARLES B. RANGEL, New York
BILL THOMAS, California FORTNEY PETE STARK, California
E. CLAY SHAW, Jr., Florida ROBERT T. MATSUI, California
NANCY L. JOHNSON, Connecticut WILLIAM J. COYNE, Pennsylvania
AMO HOUGHTON, New York SANDER M. LEVIN, Michigan
WALLY HERGER, California BENJAMIN L. CARDIN, Maryland
JIM McCRERY, Louisiana JIM McDERMOTT, Washington
DAVE CAMP, Michigan GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota JOHN LEWIS, Georgia
JIM NUSSLE, Iowa RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio XAVIER BECERRA, California
PHILIP S. ENGLISH, Pennsylvania KAREN L. THURMAN, Florida
WES WATKINS, Oklahoma LLOYD DOGGETT, Texas
J.D. HAYWORTH, Arizona
JERRY WELLER, Illinois
KENNY HULSHOF, Missouri
SCOTT McINNIS, Colorado
RON LEWIS, Kentucky
MARK FOLEY, Florida
A.L. Singleton, Chief of Staff
Janice Mays, Minority Chief Counsel
______
Subcommittee on Trade
PHILIP M. CRANE, Illinois, Chairman
BILL THOMAS, California SANDER M. LEVIN, Michigan
E. CLAY SHAW, Jr., Florida CHARLES B. RANGEL, New York
AMO HOUGHTON, New York RICHARD E. NEAL, Massachusetts
DAVE CAMP, Michigan MICHAEL R. McNULTY, New York
JIM RAMSTAD, Minnesota WILLIAM J. JEFFERSON, Louisiana
JENNIFER DUNN, Washington XAVIER BECERRA, California
WALLY HERGER, California
JIM NUSSLE, Iowa
Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public
hearing records of the Committee on Ways and Means are also published
in electronic form. The printed record of written comments remains the
official version. Because electronic submissions are used to prepare
both printed and electronic versions of the hearing/written comments
record, the process of converting between various electronic formats
may introduce unintentional errors or omissions. Such occurrences are
inherent in the current publication process and should diminish as the
process is further refined.
C O N T E N T S
__________
Page
Advisory of June 30, 2000, announcing request for written
comments on H.R. 4782, Extending Unconditional Normal Trade
Relations to Georgia........................................... 1
______
H.R. 4782:
Atlantic Council of the United States, Roger Kirk, letter.... 3
Distilled Spirits Council of the United States, Mark T.
Baker, letter.............................................. 4
JBC International, James B. Clawson, letter.................. 4
Marlowe Wines & Spirits, LLC, Larchmont, NY, Richard
Garfinkel, letter.......................................... 5
NCSJ, Advocates on behalf of Jews in Russia, Ukraine, the
Baltic States and Eurasia, statement....................... 6
ADVISORY
FROM THE COMMITTEE ON WAYS AND MEAN
Subcommittee on Trade
Contact: (202) 225-6649
FOR IMMEDIATE RELEASE
June 30, 2000
No. TR-22
Crane Announces Request for Written Comments
on H.R. 4782, Extending Unconditional Normal
Trade Relations to Georgia
Congressman Philip M. Crane (R-IL), Chairman, Subcommittee on Trade
of the Committee on Ways and Means, today announced that the
Subcommittee is requesting written public comments for the record from
all parties interested in H.R. 4782, a bill to provide for the
extension of nondiscriminatory treatment (normal trade relations
treatment) to the products of the Republic of Georgia (Georgia).
BACKGROUND:
At present, the trade status of Georgia is subject to the Jackson-
Vanik amendment to Title IV of the Trade Act of 1974 (P.L. 93-618), the
provision of law governing the extension of NTR to nonmarket economy
countries ineligible for such status as of the enactment of the Trade
Act. A country subject to this provision may gain conditional NTR,
including NTR tariff treatment, only by complying with the freedom-of-
emigration criteria under the Trade Act and by concluding a bilateral
commercial agreement with the United States providing for reciprocal
nondiscriminatory treatment. The extension of NTR is also subject to
congressional approval. The Trade Act authorizes the President to waive
the requirements for full compliance of the emigration criteria with
respect to a particular country if he determines that such a waiver
will substantially promote the freedom-of-emigration provisions and if
he has received assurance that the emigration practices of the country
will lead substantially to the achievement of those objectives.
On June 1, 1990, the United States concluded a bilateral trade
agreement with the Soviet Union, which was approved by Congress in a
joint resolution signed into law on December 9, 1991 (P.L. 102-197). In
Proclamation 6352 of October 9, 1991, the President proclaimed that
this agreement had entered into force and nondiscriminatory treatment
would be extended to the products of the Soviet Union. Subsequently,
the Soviet Union was succeeded by 12 independent states including
Georgia.
On May 6, 1992, the President determined that a Jackson-Vanik
waiver for Georgia would substantially promote achievement of the
freedom-of-emigration criteria in the statute. This determination was
followed on June 3, 1992, by Executive Order 12908, under which the
Georgia's Jackson-Vanik waiver entered into force. NTR was extended to
Georgia effective August 13, 1993, following an exchange of diplomatic
notes applying the provisions of the United States-Soviet Union
agreement to Georgia in a new bilateral agreement.
On June 3, 1997, the President determined that Georgia was in full
compliance with the Jackson-Vanik freedom-of-emigration criteria. This
determination removed the need for future waivers to continue NTR,
although Georgia's trade status remains subject to the terms of the
Jackson-Vanik amendment.
Pursuant to section 122 of the Uruguay Round Agreements Act (P.L.
103-465), requiring congressional consultation prior to country
accessions to the World Trade Organization (WTO), the United States
Trade Representative transmitted detailed materials to the Committee on
Ways and Means on September 7, 1999, on the pending accession of
Georgia to the WTO. Because the United States has not extended
unconditional NTR to Georgia as a result of the application of the
Jackson-Vanik amendment, the United States had to invoke the non-
application clause of the WTO (Article XIII) at the WTO General Council
meeting on Georgia's accession on September 30, 1999, meaning that the
United States would not apply the WTO Agreements to Georgia upon that
country's accession to the WTO. Georgia formally became a member of the
WTO on June 14, 2000.
On June 29, 2000, Chairman Crane introduced H.R. 4782, authorizing
the President to determine that the Jackson-Vanik amendment should no
longer apply to the Republic of Georgia and after making such a
determination to proclaim the extension of nondiscriminatory treatment
to the products of that country. If the bill were to become law, the
United States would be able to extend unconditional NTR to Georgia, and
all rights and obligations under the WTO agreed to by the two countries
would apply. Similar legislation, S. 2141, was introduced in the Senate
by Senator Sam Brownback (R-KS) on March 2, 2000.
DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:
Any person or organization wishing to submit a written statement
for the printed record should submit six (6) single-spaced copies of
their statement, along with an IBM compatible 3.5-inch diskette in
WordPerfect or MS Word format, with their name, address, and comments
date noted on label, by the close of business, Tuesday, July 11, 2000,
to A.L. Singleton, Chief of Staff, Committee on Ways and Means, U.S.
House of Representatives, 1102 Longworth House Office Building,
Washington, D.C. 20515.
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Note: All Committee advisories and news releases are available on
the World Wide Web at ``http://waysandmeans.house.gov''.
July 7, 2000
The Honorable Philip M. Crane
Chairman
Ways and Means Sub-Committee on Trade
1104 Longworth House Office Building
Washington, DC 20515-6354
Dear Mr. Chairman:
Thank you for asking me to submit comments concerning extension of
unconditional Normal Trade Relations (NTR) to the Republic of Georgia.
While I write in my personal capacity, I have been Chair of the
Atlantic Council's Balkan Task Force since its inception in 1996 and a
Vice Chair of its Board. I have also participated actively in the
Council's work on Russia and the Newly Independent States.
I strongly support extension of unconditional NTR to the Republic
of Georgia. By any account, Georgia has long since meet the freedom-of-
emigration criteria set forth in Jackson-Vanik and has long since met
other criteria established in the Trade Act of 1974. Georgia was first
determined to have met these criteria in 1992 by Executive Order 12908,
leading to the extension of provisional NTR in 1993. Georgia formally
became a member of the World Trade Organization on June 14, 2000. While
Georgia still has room for improvement, it has made strong progress on
issues related to the treatment of minorities and the development of
democratic governmental and market economy institutions.
Georgia's integration into the world economy ranks among important
foreign policy interests of the United States in the region. The
inability of the United States to engage Georgia fully due to the
limitations established by Jackson-Vanik limits U.S. policy and
influence throughout the region. Officials within the U.S. Department
of State strongly support the extension of NTR to Georgia, point to
Georgia as a ``positive example'' and see Georgia as the best case for
NTR in the region.
Extension of nondiscriminatory treatment to Georgia will
effectively enhance bilateral relations between Georgia and the United
States as well as U.S. relations with the whole region. Such extension
will also allow the United States to take full advantage of the rights
and obligations agreed to under the Uruguay Round Agreements of the WTO
so far as they relate to Georgia.
In addition, Georgia's participation in the WTO will, by increasing
interaction with other nations by Georgian officials and their
superiors in government and the legislature, help Georgia become a
fully contributing member of the community of democratic, market
economy nations, something which is of interest to the United States as
well as Georgia.
In short, I urge the Congress to act to extend unconditional NTR to
the Republic of Georgia as this is in the interest of the United
States.
Sincerely,
Roger Kirk
Former Ambassador to Romania
Chair, Balkan Task Force of the
Atlantic Council of the United States
DISCUS
Washington, DC 20005
July 10, 2000
The Honorable Philip M. Crane
Chairman
Subcommittee on Trade
Committee on Ways and Means
U.S. House of Representatives
Washington, DC 20515
RE: HR 4782, Extension of Unconditional Normal Trade Relations to the
Republic of Georgia
Dear Mr. Chairman:
On behalf of the Distilled Spirits Council of the United States
(DISCUS), I am writing to express our strong support for the extension
of unconditional normal trade relations (NTR) to the Republic of
Georgia. DISCUS is the national trade association representing U.S.
producers, marketers, and exporters of distilled spirits products. On
October 15, 1999, DISCUS submitted comments to the Subcommittee on
Trade in support of extending NTR to Georgia and several other ex-
Soviet states. Since that time, Georgia has formally acceded to the
World Trade Organization, making the extension of NTR even more urgent
if the United States is to benefit from Georgia's participation in the
rules-based trading system.
During the negotiation of Georgia's WTO accession agreement, DISCUS
worked closely with officials from the Office of the U.S. Trade
Representative (USTR) to secure improved terms of access to the
Georgian market. USTR negotiators succeeded in striking an agreement
with Georgia that would involve a substantial reduction of tariffs on
imported distilled spirits, with a final rate of 1.5 ECU per liter of
pure alcohol. In addition, the accession terms require that Georgia
provide the full range of protection for trademarks and geographical
indications, as required by the WTO Agreement on Trade Related
Intellectual Property (TRIPs), immediately upon accession.
The extension of unconditional NTR will create the stable trading
environment necessary to enable U.S. distillers to take full advantage
of Georgia's accession to the WTO. In the absence of extending NTR to
Georgia, U.S. companies will not enjoy the favorable terms that USTR
steadfastly negotiated as part of Georgia's WTO accession agreement,
and our exporters will be placed at a competitive disadvantage vis-
à-vis firms of other WTO members who are prepared to fully apply
the WTO to Georgia.
For these reasons, we strongly support the extension of
unconditional normal trade relations to Georgia.
Sincerely,
Mark T. Baker
Vice President,
International Trade
Mr. A.L. Singleton
Chief of Staff
Committee on Ways and Means
U.S. House of Representatives
1102 Longworth House Office Building
Washington, DC 20515
Re: Request for Written Comments on H.R. 4782
Dear Mr. Singleton:
This statement is filed on behalf of JBC International (JBC). JBC
appreciates the opportunity to comment on H.R. 4782 to extend normal
trade relations treatment (NTR) to the Republic of Georgia (Georgia).
JBC supports H.R. 4782, which will extend unconditional NTR to Georgia
and will terminate the application of Title IV of the Trade Act of 1974
to Georgia.
Introduction
JBC International is an international business-consulting firm that
provides strategies to expand, increase, and protect the international
business of corporations. JBC provides strategic advice to companies
and governments on such international trade issues as intellectual
property rights, customs automation, classification and valuation
issues, and tariff regimes. Our clients are Fortune 500 multinational
corporations with offices and manufacturing facilities in more than a
hundred countries worldwide. Members of our firm sit on a number of
international trade-related committees and councils and have a decades
long involvement with the issues and implications of international
trade.
Support for Unconditional NTR with Georgia
JBC supports the granting of unconditional NTR to Georgia for
multiple reasons. First, the passage of this bill will allow the United
States to apply the World Trade Organization (WTO) Agreement to
Georgia, including all the accompanying rights and obligations under
the treaty. Such obligations include abiding by the internationally
recognized WTO dispute settlement mechanisms. These mechanisms
encourage fair trade and enable U.S. companies to compete on a level
playing field.
They also foster the rule of law in member countries. In this
regard, U.S. companies can look forward to greater intellectual
property protection than has been historically provided in the states
of the former Soviet Union.
Extending NTR to Georgia will also enable the Georgian economy to
benefit from greater bilateral trade flows with the United States. A
growing economy will increase the demand for all goods. In 1999, the
number of countries trading with Georgia increased from 54 to 110. Laws
such as H.R. 4782 will help U.S. firms to maintain their
competitiveness in Georgia's increasingly crowded import market by
continuing to extend the trade preferences that U.S. firms have
received for most of the past decade.
Failure to ratify H.R. 4782 would be mean a retrenchment for U.S.
companies doing business in Georgia. Companies would continue without
the rights and protections extended to the United States-Georgia trade
by the WTO. Other countries would move quickly to fill the gap. Total
international trade flows for Georgia last year exceeded $800 million.
In 1999, Georgia conducted 40% of its foreign trade with members of the
Commonwealth of Independent States, and 22% with European Union
countries. Without equal access to this market, U.S. firms will
steadily lose ground.
H.R. 4782 provides an effective means of incorporating Georgia into
the world trading system. H.R. 4782 also fosters the rule of law and
strengthens the Georgian economy while providing adequate protections
to U.S. companies under WTO Agreements. It is important that the United
States continues to encourage the Republic of Georgia as a fellow
member of the global economy and that U.S. firms compete with their
European and Asian counterparts on equal terms in the Georgian market.
For these reasons, JBC International supports the enactment of H.R.
4782
Submitted by JBC International.
James B. Clawson
CEO
Marlowe Wines & Spirits, LLC
Larchmont, New York 10538
July 11, 2000
To: A.L. Singleton, Chief of Staff
Committee on Ways and Means
U.S. House of Representatives
1102 Longworth House Office Bldg.
Washington, D.C. 20515
Re: HR.4782
Dear Sir:
We are pleased to introduce ourselves. Our company has been
importing Georgian wines into the United States for the last three
years. We represent Georgian Wines & Spirits Company, Limited here.
Through my travels in Georgia and business contacts established
there I have come across numerous business opportunities for trade
developement. Georgia can become a supplier to the United States of
numerous agricultural products including canned goods. There is also
opportunity for various consumer products to be imported here from
Georgia. However, without favorable (normal) trade relations between
the USA and Georgia, the required investment for production in Georgia
is very difficult to justify. Normal trade relations will facilitate
financing for these projects.
If we can provide any additional information, please contact us.
Sincerely yours,
Richard Garfinkel
Marlowe Wine & Spirits
Statement of NCSJ Advocates on behalf of Jews in Russia, Ukraine, the
Baltic States & Eurasia
Introduction
NCSJ appreciates the opportunity to share its written
comments with the Committee on the extension of Permanent
Normal Trade Relations (``PNTR'') to the Republic of Georgia.
NCSJ represents the organized American Jewish community with
respect to Jewish concerns in the successor states to the
former Soviet Union. Since the enactment of the Jackson-Vanik
Amendment in 1974, the U.S. Congress and, in particular, the
House Committee on Ways and Means, Trade Subcommittee has
actively sought to protect the rights of minorities in the
countries subject to the Amendment. We believe it is of
continuing importance to the Committee to ensure that the
graduation of Georgia, or any other successor state to the
former Soviet Union, reflect this strong and long-standing
commitment to the protection of human rights.
NCSJ has supported, within the legal framework of the
Jackson-Vanik Amendment, Presidential determinations to extend
PNTR (i.e. Most-Favored Nation ``MFN'') to certain former
Soviet Republics through the exercise of Presidential waivers
and Presidential determinations of compliance with the
Amendment. It is not the position of NCSJ that the terms of
Jackson-Vanik should apply in perpetuity to the former
republics of the Soviet Union. However, graduation for any
successor state must be conditioned upon the development of a
legal structure that guarantees internationally recognized
human rights for its Jewish citizens, and other such
minorities, and in so doing, for all nationals of the country.
In the absence of a legal system incorporating such rights into
its legal system, provides little certainty that its citizens
will have the right to emigrate guaranteed in law and
administrative practice.
Terms of Reference
The Jackson-Vanik Amendment in Title IV of the Trade Act of
1974 (P.L. 93-618, 19 U.S.C. 2432) was enacted to ``assure the
continued dedication of the United States to fundamental human
rights,'' and in so doing addressed eliminating barriers to
emigration. For all intent and purpose, the application of
Jackson-Vanik has encompassed the observance of internationally
recognized human rights including--but not limited to--the
right of emigration. Congress has recognized that Jackson-Vanik
has become an instrument of U.S. policy for assessing certain
countries' observance of basic human rights and the protection
of minorities. These principles are reflected in H.R. 4782.
The recognition of these basic human rights by each of the
successor states to the former Soviet Union is fundamental to
the reemergence of Jewish communities and communal life.
Assessing the observance of these rights in the legal and
administrative structure is the baseline for determining
whether NCSJ can support the extension of unconditional PNTR.
The sole criteria for the extension of PNTR, i.e.,
graduation of a successor state from Jackson-Vanik, is whether
a successor state has satisfied the human rights considerations
embodied in the Amendment. The accession of a successor state
to the WTO is an insufficient basis for the granting of PNTR.
Rather the granting of PNTR and the conclusion of a bilateral
trade agreement should be the consequence of a successor state
adopting and implementing basic human rights, such as the
absolute right to emigrate.
The commitment of the U.S. Congress for more than a
quarter-century to achieving the objectives envisioned by the
Jackson-Vanik Amendment are neither conditioned nor limited by
the accession of a successor state to the WTO. In other words,
graduation of any successor state from the terms of Jackson-
Vanik must be based upon an assessment of emigration policies
as reflected in law and fact, and, no less importantly, other
national policies that affect the status of ethnic and
religious minorities, such as the Jewish community. This has
been and continues to be the foundation of the Jackson-Vanik
Amendment. With rare exception, virtually every Member of
Congress has subscribed to this formulation. In joint
resolutions, declarations, letters to officials to the FSU and
successor states and in meetings with officials prior to and
following the dissolution of the FSU. In particular, with
respect to the Jewish minority, Congress' record is
unambiguous. Therefore, graduation must be conditioned upon
Congressional consideration of the following standards and
conditions:
Unrestricted right of emigration, protection of minority
rights, including (legislation to provide protection against
incitement to violence against persons or groups based on
various criteria, including religion, e.g.anti-Semitism), and
the exercise of freedom of religion;
The incorporation of human rights standards (including
freedom of emigration and religion) into the country's
constitutional and legal structure, their protection by the
judiciary, and the implementation of administrative practices
that do not detract from such rights;
Participation in bilateral and multilateral mechanisms
related to the observance of religious freedom and basic human
rights, demonstrating a commitment to these freedoms and
rights.
The government of Georgia has been responsive to concerns
of the Jewish community, has accepted and continued its
obligations with respect to outstanding issues of communal
property restitution, and has cultivated close relations with
the United States and Israel. The leadership of President
Eduard Shevardnadze presents a useful model for other Soviet
successor states, but Georgia's future is not yet guaranteed.
Beyond the challenge of developing the next generation of
domestic leaders, instability continues to plague Georgia's
geographic and political life.
Conclusion
NCSJ believes that any legislation to graduate successor
states from the Jackson-Vanik Amendment should acknowledge
assurances from the respective governments regarding freedom of
emigration and other human rights. In other words, there should
be an assurance provided to the United States regarding these
matters.
NCSJ welcomes the inclusion of language in H.R. 4782
reflecting the commitment of the United States Congress to
advancing the basic rights of minorities in Georgia and the
other Soviet successor states. NCSJ, upon the evaluation of the
criteria identified above has concluded that Georgia has
satisfied the criteria for graduation from the Jackson-Vanik
Amendment.
On this basis, NCSJ supports the enactment of H.R. 4782 as
introduced.