WTO allows U.S. to hit EU with tariffs over Airbus subsidies



Jakob Hanke | Politico

The United States has won the right to hit the EU with billions of euros in punitive tariffs by winning a dispute over subsidies to aerospace giant Airbus, four EU officials told POLITICO.

A World Trade Organization dispute settlement panel on Friday sent the confidential ruling to the European Commission and the United States Trade Representative, the officials said.

Washington has previously announced it would follow through with tariffs if it won the case in Geneva and has prepared a list of EU products ranging from cheeses to Airbus planes and parts that it said it would hit with tariffs of up to 100 percent.

The ruling ends a decades-long dispute on whether EU countries illegally subsidize Airbus planes by granting subsidized loans known as “launch aid” and other advantages.

“The WTO decision is neither public nor authorized for release. We do not comment on rumors on a report that is not public,” an Airbus spokesperson said. A spokesperson for the European Commission said Brussels would “not comment on leaks” but said it has “communicated to the United States that the European Union is ready to work on a fair and balanced solution for our respective aircraft industries.”

The U.S. first filed a complaint in Geneva against the EU in 2006. Washington has estimated the amount of damage resulting from EU subsidies that are still in place at $11 billion.

A parallel complaint by the EU, alleging illegal U.S. subsidies for Boeing, is running with some 6 months of delay. The EU expects the outcome of that case to give the bloc the right to retaliate with its own tariffs next year, and hopes to strike an agreement with Washington to lift the sanctions.

“In the parallel Boeing case, we are expecting the WTO decision on the European Union sanction rights in the coming months,” the Commission spokesperson said. “The mutual imposition of sanctions is counterproductive and damaging to our respective economies … The EU has, as recently as July, submitted concrete proposals to the US to which there has been no reaction so far. The EU’s willingness to find a fair settlement remains unchanged.”

To read original article, click here