WTO rules in favor of U.S. in Airbus dispute, but EU calls countermeasures "counterproductive"

Oct 03, 2019

Geneva (Switzerland) Oct 03: The World Trade Organization (WTO) on Wednesday said that the United States may impose countermeasures on European Union (EU) goods and services up to a value of almost 7.5 billion U.S. dollars annually as a result of the EU's failure to comply with the WTO's ruling regarding government subsidies for the European aircraft manufacturer Airbus.
However, EU responded that any punitive measures taken by the U.S. side would be "short-sighted and counterproductive".
In an arbitration decision announced Wednesday, WTO said that the amount is commensurate with the adverse effects suffered by Airbus' U.S. rival Boeing in terms of lost sales and impeded deliveries of its aircraft.
The United States had requested authorization to impose 10.56 billion U.S. dollars annually in countermeasures.
According to WTO rules, the United States may now ask the WTO's Dispute Settlement Body (DSB) for authorization to impose countermeasures up to the amount fixed by the ruling.
This is the largest arbitration award in the history of the WTO.
The United States can make this request at the next regular DSB meeting scheduled for October 28, or request a special DSB meeting.
Following Wednesday's arbitration decision, the EU released a statement quoting its Trade Commissioner Cecilia Malmstrom as saying that the European Union "takes note" of the decision in the Airbus case and the level of possible countermeasures.
"We remain of the view that even if the United States obtains authorization from the WTO Dispute Settlement Body, opting for applying countermeasures now would be short-sighted and counterproductive," the statement said.
"Both the EU and the U.S. have been found at fault by the WTO dispute settlement system for continuing to provide certain unlawful subsidies to their aircraft manufacturers," the statement said, adding that "in the parallel Boeing case, the EU will in some months equally be granted rights to impose countermeasures against the U.S. as a result of its continued failure to comply with WTO rules."
Source: Xinhua