Brussels, 31/03/2011 (Agence Europe) - The final WTO report on the EU complaint filed against US subsidies to Boeing (DS 353) confirms the criticism made by the Organisation in January this year. The US aircraft manufacturer is reported to have received at least $5.3 billion in illegal subsidies in the form of financial support for R&D from NASA, WTO states.
On Thursday 31 March, as predicted, the WTO ruled against Washington for some of the subsidies that it had paid to the national aircraft firm Boeing, just a few months after having also condemned EU subsidies to Airbus (DS 316). In its final report, the WTO dispute settlement body considers that some of the aid denounced by the EU is indeed subsidies that run counter to world trade rules. According to calculations made by the dispute settlement body, the amount of the subsidies reached at least $5.3 billion between 1989 and 2006. In particular, blame was cast on NASA payments to Boeing for access to installations, for equipment and employees, under the eight aeronautical R&D programmes, and amounting to $2.6 billion. In addition to this were subsidies paid via 23 State Department programmes, the amount of which could not be determined by the WTO panel. Also considered illegal was the tax relief granted to Boeing under federal tax legislation and amounting to $2.2 billion. Finally, there was aid received from a number of states, including Illinois, Kansas and Washington, amounting to $560 million. The report concludes that the United States' action was “incompatible” with WTO rules and “cancelled out or compromised the advantages resulting from these rules for the EU”. Washington is therefore urged to take measures to eliminate the adverse effects or to remove the subsidies in question.
Both sides - Europeans and Americans - immediately cried victory, while the Airbus management states that the truth is finally known: Boeing received and continues to receive aid that has an effect that is far more serious in terms of market distortion than the reimbursable payments granted to Airbus. The Boeing side is boasting that WTO has rejected 80% of the complaints filed by the EU, as the amount of subsidies considered illegal (and which have not been remedied by the American maker) amounts, it says, to just $2.7 billion. Although the services under US Trade Representative Ron Kirk underline the insignificance of the amount in question given the magnitude of the EU condemnation in June 2010 for its Airbus subsidy programmes, the European Commission for its part urges the US government to take “appropriate measures” to reach a negotiated solution. (E.H./transl.jl)