Tuesday, 25 September, 2018

European Union still providing illegal subsidies to Airbus

Watch video 01:10  Back from the brink Emirates order rescues Airbus jet Watch video 01:10 Back from the brink Emirates order rescues Airbus jet
Orlando Vargas | 16 May, 2018, 05:26

The EU will now take "swift action to ensure it is fully in line with the WTO's final decision in this case", she said.

The report comes at a time of mounting trade tensions over US aluminum and steel tariffs and the impact on European firms of Washington's decision to exit the Iran nuclear pact.

"This landmark ruling by the WTO Appellate Body is the final decision in this case, which was initiated in 2006", the release said.

"This report confirms once and for all that the European Union has long ignored WTO rules, and even worse, European Union aircraft subsidies have cost American aerospace companies tens of billions of dollars in lost revenue", US Trade Representative Robert Lighthizer said in a statement. The bloc compounded the issue with below-market loans for the planemaker's marquee A350 jetliner.

Later this year, a separate WTO compliance panel is expected to deliver its decision as to whether the US complied with the terms of a 2012 ruling against illegal USA tax subsidies that gave Boeing an unfair advantage.

The financing hurt sales of Boeing's 747 jumbo jetliner and 787 Dreamliner and clipped exports to the EU, Australia, China, Korea, Singapore and the United Arab Emirates, the panel determined.

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"Today's final ruling sends a clear message: Disregard for the rules and illegal subsidies is not tolerated", Boeing CEO Dennis Muilenburg, said in a statement.

It is anticipated that USA tariffs will be authorized up to the amount of annual harm the subsidies are determined to cause.

The Geneva watchdog, however, had dismissed USA claims that the loans for the most popular models of Airbus, the A320 and A330, were costing aignisignif sales to Boeing.

Airbus chief executive Tom Enders said the report was "really only half the story..."

BA shares closed -0.7% in today's trade, while EADSY ended -1.9%. Later this year, a separate WTO compliance panel is expected to deliver its decision on whether the USA complied with the terms of a 2012 ruling against illegal US tax subsidies that gave Boeing an unfair advantage. Boeing fell less than 1 percent to $342.09 at 12:37 p.m.in NY, recovering from losses logged before the decision was issued. This is proof of Boeing's cynical PR motives in bringing this case about in the first place.

The US accused the European Union and the four countries of providing grants, preferential loans and other illegal aid to Airbus to help it to build its entire fleet of civilian aircraft, to the...

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