WTO delivers ruling on 15-year-long Boeing vs Airbus rift
A ruling by the World Trade Organisation (WTO) would soon be made over subsidies for rival aircraft makers Boeing and Airbus, a dispute that has pitted the United States against the European Union over the past 15 years.
The expected WTO verdict will decide whether the U.S. has stopped bolstering Boeing since the Geneva-based trade body found in 2012 that the U.S. Company received illegal subsidies.
If the WTO says that support measures were scrapped too late, the EU can claim compensation.
The EU has argued that European aircraft maker Airbus suffered immense damages because of unfair competition from Boeing.
However, the WTO has also found that the European bloc violated international trade rules by subsidizing Airbus and it ruled in 2018 that the EU failed to phase out all of its support.
Following the latest and final decision that is expected later in Geneva, Washington and Brussels can either let a WTO mediator calculate the damages that each side owes to the other.
The decision also said they can settle the dispute by negotiating a pact.
Economic Confidential recalls in May last year when the European Union told the World Trade Organization’s dispute settlement body that it had acted within days of a WTO ruling to bring its funding of plane maker Airbus into line with WTO rules, a trade official who attended the meeting said.
The United States won a partial victory on May 15 against EU support for Airbus at the WTO, clearing the way for possible U.S. sanctions in a 14-year-old dispute over claims of illegal handouts for aircraft makers.
The EU said then it had taken steps to comply with the WTO ruling on subsidies for its A350, Europe’s newest long-haul jet, and the A380, the world’s largest airliner, and reiterated its efforts at a closed-door WTO meeting on Monday.
The EU said it had made “contractual changes to the loan terms for the A380 and the A350XWB models of aircraft, where it was found that the repayable loans provided to Airbus for these aircrafts did not sufficiently reflect market conditions.”
But a U.S. representative at the WTO meeting said it was hard to give credence to the EU’s assertion, after four previous rulings that had disagreed with similar EU claims to have brought Airbus’s financing into line with market benchmarks.
Under WTO rules, Washington could now ask the WTO to set a level of sanctions allowed against the EU.