Trade – WTO decision on Airbus (2 October 2019)

Trade – WTO decision on Airbus (2 October 2019)

The World Trade Organization (WTO) has just issued a ruling on the amount of punitive tariffs the United States can impose against the Europeans in the complaint brought by the U.S. in 2004 on refundable advances to Airbus by France, Germany, Spain, and the United Kingdom.

The authorization to impose sanctions must now be formally adopted by the WTO’s Dispute Settlement Body. The U.S. could then raise tariffs on a series of European products by $7.5 billion per year.

The EU will be entitled to do the same in several months in relation to complaints concerning U.S. subsidies to Boeing. The WTO’s Appellate Body confirmed on March 28 that despite previous rulings by the WTO, the United States had not withdrawn the subsidies granted to Boeing between 1989 and 2006, amounting to $5 billion, and that it had continued to provide massive and continuous support to Boeing through export subsidies prohibited under WTO law, granting Boeing a significant commercial advantage to the detriment of Airbus.

The escalation of trade tensions with our American partner and ally is not advisable and will have significant impacts on both of our economies, international trade, and the aviation industry.

The EU would prefer an amicable settlement in this 15-year-old dispute and the development of new common rules on government support for aviation companies.

Unfortunately, the U.S. does not seem prepared to negotiate at this stage. We are therefore responding firmly and will defend European interests by imposing the retaliatory measures authorized by the WTO against the United States.

The French authorities reaffirm their commitment to compliance with WTO rules, which enable the law and the multilateral resolution of disputes to prevail in trade matters.

Last updated on: 4 October 2019
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