U.S. seeks WTO compliance in EU plane battle

   The United States on Friday asked the World Trade Organization to set up a compliance panel to address the European Union’s failure to remove WTO-inconsistent subsidies to aircraft manufacturer Airbus.
   “We refuse to stand by while American businesses and workers are disadvantaged,” said U.S. Trade Representative Ron Kirk, in a statement. “The European Union’s aircraft subsidies have cost American aerospace companies tens of billions of dollars in lost revenue, which has cost American workers their jobs and hurt their families and communities.”
   He added: “The United States remains prepared to engage with the EU in any meaningful efforts that will lead to the goal of ending subsidized financing at the earliest possible date.”
   In June 2011, the WTO ruled that the European Union and four of its member states conferred more than $18 billion in subsidized financing to Airbus, and that European government launch aid had been used to support the creation of every model of large civil aircraft produced by Airbus.
   The WTO found these subsidies caused U.S.-based Boeing to lose sales of more than 300 aircraft and lose market share throughout the world. The WTO appellate body said that “without the subsidies, Airbus would not have existed… and there would be no Airbus aircraft on the market. None of the sales that the subsidized Airbus made would have occurred.”
   In contrast, the WTO rejected the EU assertion that U.S. subsidies were responsible for the viability of Boeing’s large civil aircraft production.
   In December 2011, the European Union claimed to have removed the WTO inconsistencies, but provided no evidence to support its claims. However, the United States claims the European Union has not removed its WTO-inconsistent subsidies and has even provided new ones. To provide the European Union with an additional opportunity to explain its claims, the United States held consultations with the European Union in January 2012.
   “The EU was unable or unwilling to substantiate its claims to have addressed the WTO inconsistencies, and the consultations failed to resolve the dispute,” the Office of the U.S. Trade Representative said.
   The United States has asked for a meeting of the WTO Dispute Settlement Body on April 13 to address this issue. Pursuant to an agreement between the United States and the European Union, a panel will be established at that meeting.