Vietnam PNTR Legislation Introduced in House and Senate
On June 13, 2006, legislation to authorize the termination of the application of Jackson-Vanik trade restrictions and the extension of permanent normal trade relations (PNTR) for Vietnam was introduced in the Senate and House of Representatives.
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(After introduction, the Senate bill, S. 3495, was referred to the Senate Finance Committee and the House bill, H.R. 5602, was referred to the House Ways and Means Committee.)
Specifically, S. 3495 and H.R. 5602 would:
authorize the President to determine that Title IV of the Trade Act of 1974 (which includes the Jackson-Vanik freedom of emigration requirements) should no longer apply to Vietnam,
allow the President, after such a determination, to proclaim the extension of PNTR to products of Vietnam; and
provide that on or after the effective date of the extension of PNTR to the products of Vietnam, Title IV of the Trade Act of 1974 shall cease to apply to Vietnam.
According to sources, neither the Senate Finance Committee nor the House Ways and Means Committee has scheduled a hearing on these bills, although they may at some point in the future. Senate sources state that the sponsors of S. 3495 hope to have the bill passed before the August 2006 recess. Sources note that although Senators will likely raise concerns regarding specific issues, the overall PNTR proposal has broad bipartisan support.
Although Vietnam was granted normal trade relations (NTR) status (including column '1' duty rates) effective December 10, 2001, Vietnam is currently ineligible for PNTR because it is subject to Jackson-Vanik requirements. The U.S. typically terminates a country's Jackson-Vanik status and grants that country PNTR as part of its accession to the World Trade Organization (WTO).
(According to a press release issued by the sponsors of S. 3495, the U.S. and Vietnam completed their bilateral WTO accession agreement on May 31, 2006. The press release also notes that Vietnam hopes to become a WTO member before it hosts the Asia-Pacific Economic Cooperation (APEC) summit in Hanoi in November 2006.)
(See ITT's Online Archives or 06/02/06 news, 06060205, for BP summary of USTR notices, press release, on the U.S. - Vietnam bilateral accession agreement.)
S. 3495 available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:s3495is.txt.pdf.
H.R. 5602 available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:h5602ih.txt.pdf.
USTR statement (dated 06/13/06) available at http://www.ustr.gov/Document_Library/Press_Releases/2006/June/USTR_Schwab_Welcomes_Congressional_Action_to_Increase_Trade_with_Vietnam.html.
Senators Baucus and Smith press release (dated 06/13/06) available at http://finance.senate.gov/press/Bpress/2005press/prb061306.pdf.
BP Note on Elimination of Quotas on Vietnam Clothing and Textiles
USTR sources have previously stated that once Vietnam becomes a WTO member, U.S. quotas on clothing and textiles can be eliminated if the U.S. has granted Vietnam PNTR status.