Expert: the US is trying to make another law the Jackson-Vanik amendment


RIA Novosti

The consequences of the bill, among other things, suggesting the increased pressure on the financial sector of the Russian Federation and Russian energy companies, will be extremely noticeable in case of its adoption, it is a de facto attempt of the new legislation, the Jackson-Vanik amendment, said to RIA Novosti, the portfolio Manager Principal Investors (new York) Kyle Shostak, who specializiruetsya, including on investments in the Russian market.

Earlier, us senators reported on the preparation of new measures of pressure on Russia. It is expected that these initiatives will be “attached” to the pending bill on sanctions against Iran. Speech, in particular, will focus on the refinement of existing sanctions against Russia and the introduction of new measures against Moscow. The text of the bill, which was read RIA Novosti noted that Russian banks under sanctions, may limit the financing term from 90 days to 14. In addition, the Russian energy sector, which is under sanctions, may limit the period of funding from the us agencies and individuals up to 30 days. Under this bill, the US Congress should vote in the coming days.

“The consequences of this bill can be very substantial, because there are financial penalties relating to the capabilities of the refinancing of Russian banks and the oil and gas sector, opportunities to purchase equipment, technology, including related to offshore drilling,” he said.

Shostak added that it is “a very sensitive sector of the Russian economy”.

“Of course (the market is afraid of new sanctions). Running mechanism on the bill, which in some modifications circulating in Congress since January. But the January draft differs from that presented now. The latter is more comprehensive,” continued the expert.

It is difficult to say how successful will this latest bill in Congress. “Hard to say, because it requires the unanimous adoption and, certainly, there will be people who will not agree with him. But in recent months lined up in such a bipartisan consensus on these issues, which, in General, does not look good for Russia. But it is not obvious that such a bill will be passed,” he said.

“Jackson-Vanik” is returned

According to experts, this bill is “actually an attempt to adopt a new law the Jackson-Vanik amendment”.

“This is an attempt to build (decrees of the President, which had previously imposed sanctions) into law. Trying to do so, as it was in 70-e years. This step, of course, he changes the game and momentum. If decrees can be canceled or extended, then the cancellation law is very complex,” he said.

According to Shostak, in the case of the adoption of this law the Russian market “will react in a negative way”, perhaps “even the ruble will react”.

Thus, according to him, “these things are usually advertised”. “The market is a very living thing, at some point when this news line is, the market absorbs the price prices. And when the law is already out for review and is accepted, by the time these things are taken into account,” he said.

Shostak recalled that the last word should still be President Donald trump, who can veto the project or send it back for revision.

However, he agrees that “the market has not yet factored in these risks.” “Until the law is not reached, the story is still a little lit on the Russian market. And yet, I think market participants in the mass, didn’t realize it,” — said the expert.

The Amendment Of Jackson-Vanik

The amendment of Jackson-Vanik (The Jackson-Vanik Amendment) contained in Chapter IV of the “Law on trade” (Trade Act of 1974) of the United States.

The amendment was named after its sponsors, Senator Henry Jackson (Henry Jackson) and Congressman Charles Vanik (Charles Vanik), which promoted the amendment.

Under the amendment, the MFN could be extended only to those countries with non-market economies, emigration regime which admitted liberal. Against violators of international norms, the US has imposed sanctions, mainly related to the limitations of the goods produced in this country in the world, to the American market.

The reason for the amendment was caused, in particular, the practice of restriction of departure of persons of Jewish nationality from the Soviet Union. Conditions contained in the adopted law, was described by the Soviet government as interference in the internal Affairs of the country and rejected, resulting in the Soviet Union were denied the most-favored-nation.

The law on trade entered into force after its signing by President Gerald Ford on 3 January 1975.

Due to the lack of favorable treatment to Soviet exports to the United States were subject to duties in excess of ten times normal.

After 1985, in terms of free travel and emigration of citizens of the USSR (and since 1991 — the Russian Federation), the amendment has lost its meaning. Since 1989 the special decisions of the President of the United States annually imposed a moratorium on the amendment in relation to the USSR and then CIS countries, but the official amendment has not been cancelled.

The amendment of Jackson-Vanik has long marred relations between Russia and the United States, being one of the symbols of the former confrontation between the two States and the cold war.

In 2002, the United States officially recognized Russia as a country with a market economy, and from that moment all formal occasions, preventing the removal of the amendment was eliminated.

President Barack Obama December 20, 2012 signed a decree on termination of the restrictive trade amendment of Jackson-Vanik on goods imported from Russia. The decision to cancel the Jackson Vanik amendment was adopted in conjunction with the law on introduction of visa sanctions against officials involved in human rights violations (the law on the “Magnitsky list”).