EU calls on US to lift tariffs in plane dispute  

  24 July 2020    Read: 656
EU calls on US to lift tariffs in plane dispute  

The EU called Friday on the United States to lift tariffs imposed in a long-running dispute over aircraft subsidies after Airbus said it had brought itself into compliance with World Trade Organization rulings, reports citing AFP.

The billions of dollars in tariffs, which apply to a wide range of food and agricultural goods in addition to planes, have been even more burdensome due to the economic disruption caused by the coronavirus pandemic.

Airbus said Friday it had reached agreement with the French and Spanish governments that raises the interest rates on funds provided to help develop its long-haul A350 jet to levels the WTO considers appropriate.

The European Commission said this removes any grounds for the US to maintain tariffs imposed on EU exports under WTO rulings as well as making a strong case for a rapid settlement of the dispute.

"Unjustified tariffs on European products are not acceptable and, arising from the compliance in the Airbus case, we insist that the United States lifts these unjustified tariffs immediately," EU trade commissioner Phil Hogan said in a statement.

An epic legal battle between Airbus and Boeing at the WTO began in 2004 when Washington accused Britain, France, Germany and Spain of providing illegal subsidies and grants to support the production of a range of Airbus products.

A year later, the EU alleged that Boeing had received $19.1 billion worth of prohibited subsidies from 1989 to 2006 from various branches of the US government.

The two cases were then tangled up in a legal quagmire, with each side being given partial vindication after a long series of appeals and counter appeals.

In 2019 the WTO authorised the US to impose up to 100 percent in taxes on $7.5 billion of European goods, its biggest ever penalty.

Washington then slapped 25 percent tariffs on a number of EU goods including wine, cheese and olives.

A 10 percent tariff on Airbus planes was increased to 15 percent in March, which also affects US airlines which buy Airbus aircraft, as the manufacturer points out.

In June the US threatened to levy tariffs on another $3.1 billion in EU goods as it has been authorised to do under a WTO ruling.

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