EU appeals WTO Airbus illegal subsidy ruling

BRUSSELS — The EU on Thursday appealed a decision by the World Trade Organisation (WTO) that found the European Union guilty, as charged by giant US rival Boeing, of providing illegal subsidies to Airbus.

The bitter spat over Airbus at the WTO comes just as the European Union and the United States struggle to save years of negotiations on the world’s biggest trade deal amid deep public scepticism that it will deliver the benefits promised.

The European Commission, the EU’s executive arm that handles WTO disputes for the bloc, said “significant aspects of the compliance panel report cannot be regarded as satisfactory”.

“The EU in particular disagrees with the legal conclusion that, even though most of the subsidies challenged by the US have ended, the EU has not yet fully complied with the previous ruling,”it said in a statement.

The WTO appeals panel, ruling in a dispute dating back to 2004, said on September 22 that the EU had not taken steps it had ordered in 2011 to withdraw several support and subsidy programmes for Airbus.

The WTO did not put a value on those programmes, but Boeing said they amounted to $22 billion worth of illegal support for Airbus development and sales, mostly in subsidised loans.

The EU appeal comes a day before top US trade officials visit the WTO to defend Boeing against what the company calls unfair competition from its European rival.

The US wants the WTO to formally adopt the appeals panel’s findings, and “will press for the rapid enforcement of those findings in a special meeting of the WTO’s Dispute Settlement Body”, the US Trade Representative’s office said last week.

“We will not tolerate our trading partners ignoring the rules at the expense of American workers and their families,”US Trade Representative Michael Froman said.

Boeing also claimed that as a result of the September 22 ruling, the United States could now levy retaliatory duties against the EU of up to $10 billion a year.

The EU noted Thursday that the WTO still has to rule on two cases it has brought against Boeing over massive alleged illegal subsidies it has received.

Washington has said it is ready to negotiate a solution over the broader dispute.