WTO rejects EU claims over Airbus subsidies

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The World Trade Organization does not believe the EU is no longer subsidising an aircraft manufacturer.

The World Trade Organization (WTO) has controversially rejected claims by the European Union (EU) that it is no longer providing subsidies to aircraft manufacturer Airbus.

A ruling found that as a result of past European loans, Airbus A380 and A350 jetliners continue to be subsidised. EU claims that the halt in production of the A380 means it is no longer a threat to Boeing were also rejected by the panel.

The news prompted the US to say it may now increase retaliatory tariffs on European goods because the subsidies are continuing to harm the US aerospace industry.

This is the latest development in what is proving to be a record transatlantic trade dispute.

In October, the US was given the right to apply tariffs of ten per cent on large civil aircraft imported from Europe, as well as levies of 25 per cent on a range of other products including whisky and cheese.

It may be possible for the EU to appeal the ruling, but the issue is that the WTO Appellate Body that would handle it will cease to function on December 10th 2019 due to US blocking of new appointments.