European Planemaker Sees The Ruling Differently
The World Trade Organization ruled Tuesday that grants from
European governments received by Airbus have given an unfair
advantage to the planemaker over its rival Boeing. However, in a
news release, Airbus says 70% of the U.S. complaints were
"rejected."
Sources with knowledge of the confidential ruling told the
Associated Press that the WTO has upheld the interim decision
released in September. That document said the risk-free loans,
research funds, and infrastructure assistance granted to Airbus
from European governments were, in some cases, unfair to
Boeing.
In a news release, Airbus claimed it was vindicated by the
report. The company holds that:
- 70 percent of the U.S. claims were rejected.
- The European reimbursable loan mechanism is confirmed to be a
legal and compliant instrument of partnership between government
and industry.
- The Panel refused the US request for remedies as legally
inappropriate.
- Past loans were found by the Panel to contain a certain element
of subsidy, a finding we will study.
- Possible future funding for the A350 is not affected in any way
by today's report. US attempts to include the A350 were
specifically rejected.
- Neither European RLI nor any other measure has caused "material
injury" to any US interest. This means that the Panel has rejected
the US claims that European measure caused job losses or lost
profits in the US aircraft industry. Boeing claims of lost US jobs
have now been judged and found to be false.
- Research grants have been condemned as structurally
non-compliant, with important implications for the coming report on
US subsidies to Boeing.
"These results are in stark contrast to Boeing's enthusiastic
expectations announced only last (Monday) night in a statement by
the company. Airbus, the EU and the Member States will closely
analyze today's ruling in advance of a possible review by the WTO
appellate body," Airbus said in the release.
A380
Airbus said it expects the WTO to issue the report on Boeing
subsidies in June. "Boeing's recent WTO enthusiasm is unlikely to
survive WTO confirmation that the B787 is the most highly
subsidized aircraft program in the history of aviation," it said in
the statement.
Airbus also says it expects the WTO conflict to drag along for
at least a few more years. As in all other trade conflicts,
resolution will finally only be found in trans-Atlantic
negotiations. Airbus claims that Boeing's repeated rejection of
European offers for negotiation over years and again Monday night
usurp the proper role of the US Government and contradict the US
trans-Atlantic partnership with European nations.
The New York Times reports that the WTO ruling says that the
subsidies for the massive A380 were the most egregious, and that
they should be pulled "without delay." However, it said that
subsidies for development of the A300 through A340 aircraft were
"actionable," meaning they should be removed within six months.
B787
While the WTO can't force governments to eliminate subsidies, it
is free to OK sanctions against countries that do not comply with
its rulings. In this case, sources said that those sanctions, if
any, could take more than 10 years to implement.