THE WORLD Trade Organization (WTO) yesterday rejected European Union claims that it no longer provides subsidies to aeroplane maker Airbus, underscoring tariffs recently imposed by the United States on European goods.
A new compliance report from the Geneva trade watchdog found that the Airbus A380 and A350 jetliners continue to be subsidised as a result of past European government loans.
It is the latest move in a record transatlantic trade dispute involving mutual claims of illegal aircraft subsidies, coming to a head at a time of rising global trade tensions.
The United States was in October awarded the right to impose tariffs on $7.5bn (£5.8bn) of annual EU imports in the case against Airbus. It went ahead with partial tariffs on most Airbus jets and products from cheese to olives and single-malt whisky.
A decision on retaliation rights for the EU in a parallel case on aid for Boeing is due next year.
In yesterday's finding, a threeperson panel rejected EU claims that a recent decision by Airbus to stop producing the slow-selling A380 meant the giant airliner could no longer be seen as a threat to Boeing, whose competing 747 is also out of fashion.
While the WTO no longer faulted Airbus for causing lost sales to Boeing with the A380, which is no longer marketed, it ruled that the superjumbo would continue to cause market-share damage to Boeing for as long as it is produced and delivered.
Airbus plans to shut production in mid-2021.
The WTO appeared to strengthen findings against the A350, saying it had both cost sales and damaged Boeing's market-share prospects — a process called impedance — in the busier twin-engined long-haul market where Boeing offers its 787 Dreamliner.
The European Commission said it took note of the report, adding it contained a number of serious legal errors. The Commission said it would consider its next steps, including a possible appeal, while seeking an overall agreement on aircraft subsidies with the United States. There was no immediate comment from the US trade representative.
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