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Fri, Jul 02, 2010 - Page 10 News List

US claims ‘landmark victory’ in WTO Airbus ruling


The US on Wednesday claimed a “landmark victory” in a WTO ruling over its complaint on multibillion dollar subsidies for Airbus as the European aerospace giant was expected to appeal.

Boeing said it had won a “sweeping legal victory” following the ruling that some European state subsidies to Airbus are illegal and said the decision required Airbus to repay US$4 billion, a claim disputed by the France-based firm.

“Boeing is deliberately misleading the public in claiming that repayment by Airbus in any amount is required,” said Airbus spokesman Rainer Ohler in a statement, adding that the company “deplore[s] this active misinformation.”

Boeing chief executive officer Jim McNerney, meanwhile, called the WTO panel’s move “a landmark decision and sweeping legal victory over the launch aid subsidies that fueled the rise of Airbus.”

The six-year US complaint had held that unfair subsidies from the EU to Airbus worth up to US$200 billion helped the European maker seize more than half of the market for civil airlines.

McNerney said the Office of the US Trade Representative deserved “tremendous credit” for the decision.

“We now join the US government in urging full compliance with the ruling and a permanent restoration of fair competition within our industry,” he said.

US Trade Representative Ron Kirk claimed a “landmark victory” in the ruling, which he said would “benefit American aerospace workers, who have had to endure watching Airbus receive these massive subsidies for more than 40 years.”

The subsidies, Kirk said, “have greatly harmed the United States, including causing Boeing to lose sales and market share. Today’s ruling helps level the competitive playing field with Airbus.”

Seventy percent of the US claims “were rejected and wild allegations have been proven wrong,” Airbus said in a statement.

“Neither jobs nor any profits were lost as a result of reimbursable loans to Airbus,” the European aircraft maker said.

Brussels has yet to decide whether or how precisely it will appeal, pending WTO findings expected on July 16 on a ­parallel probe into US state aid for Boeing.

EU trade chiefs expressed “disappointment” following Wednesday’s ruling as EU Trade Commissioner Karel De Gucht said the report “needs to be read together with the forthcoming interim report on subsidies provided in the US to Boeing.”

The decision, revealed confidentially to both parties three months ago, is the long-awaited finding on a US complaint launched in 2004 over what Washington said was unfair state support for Airbus.

The US has argued that the European measures of state launch funding were “specific subsidies ... causing or threatening to cause injury to US industry.”

Washington said the moves impeded imports of large US civil airliners in world markets, including the 27-nation EU, by undercutting the price of US airliners, forcing down prices significantly and costing lost sales.

“What emerges clear as day from this panel report is that ­Europe has never been able to provide launch aid in a manner that is consistent with its WTO obligations,” said Tim Reif, general council for the office of the US Trade Representative. “This panel report should therefore be a strong signal to the European Union and the member states to refrain from future launch aid disbursements.”

Airbus, meanwhile, pushed back at reports that the WTO ­ruling would derail ongoing efforts to win a US$35 billion Pentagon contract to supply new aerial refueling tankers to the US Air Force.

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