"Today, the EU and Airbus have suffered another sound defeat in this decade-long cause. The time has finally come for them to fulfill their global trade obligations and eliminate and remedy the 22 billions of dollars of state aid and illegal subsidies that are hurting US aerospace companies and American workers", Said General Counsel Boeing J. Michael Luttig yesterday.
The WTO has confirmed that the United States practically respected all WTO decisions in the case that the EU has taken against the United States in the 2006. The European Union and Airbus have claimed that Boeing benefited from ten of the billions of dollars in subsidies and focused their arguments on the research and development contracts that Boeing received from the National Aeronautics and Space Administration and the Department of Defense.
"The WTO has again categorically rejected the accusations of Europe and Airbus. The WTO originally dismissed 80% of the allegations made by the EU and today stated unequivocally that the US has potentially fulfilled all obligations on the remaining amount.", Added Luttig.
The WTO, in addition to believing that the United States has complied with the previous resolution relating to several American government R&D contracts with Boeing, today also rejected the EU accusations against the investment incentives that Boeing received in South Carolina, others older state incentives and local taxes, the FAA CLEAN program and seven of eight Washington State tax incentives.
"Today's decision is in stark contrast to the conclusions reached by the WTO last September, namely that the EU had done virtually nothing to comply with the WTO decision against illegal, market-distorting state subsidies given to Airbus for 40 years. Importantly, the WTO also found that the EU continued to provide Airbus with other illegal subsidies, while also providing state aid for another product, the A350.", Continued Luttig.
"The United States and Boeing are committed to complying with WTO regulations and behaving accordingly. It is time for the EU and Airbus to improve their WTO obligations - or face significant American sanctions in the coming year", he has declared.
According to the WTO rules, the rates for non-compliance are collected based on the damage that the subsidies cause annually, which the AUSTR in this case estimates in a range between 7 and 10 billion dollars.
"Airbus and its government sponsors have come to the end of the journey. The WTO has now said that the EU has provided Airbus 22 with billions of dollars in illegal subsidies and that they have refused to eliminate or remedy these subsidies, since they should do so. The WTO also said that the United States is practically in full compliance with the prescribed obligations and with the WTO rules. The time has already passed for the EU and Airbus to comply with the WTO rules”Added Luttig.
Luttig also underlined the huge difference between the subsidies found by the WTO regarding the United States versus Europe cause. The only remaining investment incentives were deemed incompatible with the WTO rules - a reduction in Washington State business and tax rate for aerospace employment - a figure to be cut in the tax to be paid of around 100 million dollars a year. In contrast, the WTO repeatedly held that Airbus benefited from the 22 billion dollars in illegal European subsidies.
