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Boeing, US claim win in WTO subsidies case

written by australianaviation.com.au | July 1, 2010
Airbus may have to renegotiate the terms of some of the launch aid it was given to develop the A380. (Airbus)

Airbus and Boeing have traded claims after a judging panel of the World Trade Organisation (WTO) issued its ruling that some aid given to Airbus in the development of the A380 was illegal and must end.

“This is a landmark decision and sweeping legal victory over the launch aid subsidies that fuelled the rise of Airbus and that continue to provide its products a major cost advantage,” said Boeing chairman and CEO Jim McNerney.

In accordance with the ruling, Airbus will have to renegotiate the terms of some of the launch aid it was given to develop the A380 to bring it more in line with commercial terms within 90 days of the panel’s decision being adopted by the full WTO membership, which is expected to take some months. Any remedy is expected to be delayed should the EU launch an appeal, which appears likely.

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Airbus hit back at Boeing’s rhetoric, issuing a statement that said that 70 per cent of the US’s arguments were rejected by the WTO panel, including assertions that jobs and profits in the US had been adversely affected by the use of reimbursable loans to Airbus.

“These results are in line with the previous versions of the WTO panel’s findings. Airbus, the EU and the member states are closely analysing the report in advance of a possible review by the WTO Appellate Body,” said Rainer Ohler, head of public affairs and communications at Airbus.

Airbus also pointed to an interim ruling on a countersuit filed against the US and Boeing by the EU, which is expected to be released in July. “Only the availability of the report on the parallel case on Boeing subsidies will bring the necessary balance to allow for a possible start of negotiations, without any preconditions,” Ohler said.

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Boeing, US claim win in WTO subsidies case

written by australianaviation.com.au | July 1, 2010
Airbus may have to renegotiate the terms of some of the launch aid it was given to develop the A380. (Airbus)

Airbus and Boeing have traded claims after a judging panel of the World Trade Organisation (WTO) issued its ruling that some aid given to Airbus in the development of the A380 was illegal and must end.

“This is a landmark decision and sweeping legal victory over the launch aid subsidies that fuelled the rise of Airbus and that continue to provide its products a major cost advantage,” said Boeing chairman and CEO Jim McNerney.

In accordance with the ruling, Airbus will have to renegotiate the terms of some of the launch aid it was given to develop the A380 to bring it more in line with commercial terms within 90 days of the panel’s decision being adopted by the full WTO membership, which is expected to take some months. Any remedy is expected to be delayed should the EU launch an appeal, which appears likely.

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Airbus hit back at Boeing’s rhetoric, issuing a statement that said that 70 per cent of the US’s arguments were rejected by the WTO panel, including assertions that jobs and profits in the US had been adversely affected by the use of reimbursable loans to Airbus.

“These results are in line with the previous versions of the WTO panel’s findings. Airbus, the EU and the member states are closely analysing the report in advance of a possible review by the WTO Appellate Body,” said Rainer Ohler, head of public affairs and communications at Airbus.

Airbus also pointed to an interim ruling on a countersuit filed against the US and Boeing by the EU, which is expected to be released in July. “Only the availability of the report on the parallel case on Boeing subsidies will bring the necessary balance to allow for a possible start of negotiations, without any preconditions,” Ohler said.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

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