Russia, the world’s ninth largest economy, is expected to become a full member of the World Trade Organization (WTO) in August 2012. Upon WTO membership, Russia will implement a number of market reforms across virtually all sectors of trade, including
- Reducing its average tariff on manufacturing products from 10 percent to 7 percent, eliminating tariffs on IT products and cutting its average tariff on agriculture products from 13 percent to 10.8 percent
- Capping its agricultural subsidies and reducing them in half by 2018
- Applying non-discriminatory rules to its services market and allowing 100 percent U.S. ownership of companies in banking, telecommunications and other service sectors
- Providing a more open, predictable market for foreign investment
- Offering stronger protections for patents, copyrights and other intellectual property
- Adopting universal customs rules and procedures for imports, including cutting its customs clearance fee by two-thirds
- Subjecting itself to the jurisdiction of dispute settlement to help ensure its WTO commitments are met
Russia’s new WTO membership, which will create a more stable, rules-based Russian market, is expected to help double U.S. exports of goods and services to Russia in five years. U.S. exporters of most goods will benefit from Russian tariff reductions immediately upon Russian accession, but the United States will need to extend permanent normal trade relations (PNTR) to Russia for U.S. exporters and investors to benefit from the full range of Russia’s WTO accession commitments. Steps are being taken in the U.S. Congress to pass PNTR legislation for Russia this year.
The McDermott Difference
McDermott Will & Emery’s International Trade Group is actively engaged in Russia-related WTO issues and WTO matters generally. Our lawyers work closely with the U.S. and EU government officials responsible for negotiating and enforcing Russia’s WTO accession commitments. Our lawyers can help clients understand how Russia’s WTO accession commitments will affect their business, ensure that Russia properly implements its commitments in sectors of interest, navigate new customs rules and procedures, and pursue a wide range of new market opportunities in Russia resulting from WTO membership.
For more information, please contact your regular McDermott Will & Emery lawyer or one of the following McDermott International Trade Group lawyers:
Carolyn G. Gleason: +1 202 756 8215 cgleason mwe.com
Pamela D. Walther: +1 202 756 8220 pwalther mwe.com
Jay L. Eizenstat: + 1 202 756 8383 jeizenstat mwe.com
Philip Bentley: + 32 2 282 35 27 pbentley mwe.com