Canadian Manufacturing

EU seeks $12-billion in sanctions from U.S. in aero subsidy dispute

It's the latest salvo in a seven-year dispute between the EU and the U.S. over subsidies to Boeing and Airbus



BRUSSELS—The European Union is seeking up to $12 billion per year in sanctions from the U.S. as part of a long-running dispute involving government subsidies to plane makers Airbus and Boeing, the World Trade Organization said Thursday.

The EU said in a statement that the amount was “based on estimates of the damages suffered by the EU due to unfair and biased competition from the U.S. industry,” which received U.S. government subsidies.

The action marks the latest salvo in a seven-year dispute between the EU and the U.S. over subsidies to the two plane makers.

Boeing Co. and Airbus are fighting over a market believed to be worth more than $3 trillion over the next decade. The WTO has found fault on both sides.

In March, a WTO appeals panel upheld an earlier finding that Boeing received at least $5 billion in subsidies that hurt its European archrival and were prohibited under international trade rules. The amount, though, was far less than the European Union had alleged in its complaint.

On Monday, the U.S. claimed it had complied with that ruling by stopping some payouts to Boeing through NASA and the Pentagon and by removing some beneficial tax and funding policies.

The EU has rejected those claims.

Still, it has not emerged unscathed from the dispute, either. A WTO panel has ruled that European governments provided $18 billion in subsidies to Airbus, though not all were deemed illegal.

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