WASHINGTON — The Obama administration on Thursday claimed a victory in its long-running trade dispute with the European Union over whether the 28-country bloc is illegally helping airplane manufacturer Airbus.
In June 2011, the World Trade Organization found that the EU and four of its member countries provided billions of dollars in subsidized financing to Airbus. While the EU subsequently claimed to have come into compliance, the United States disagreed and requested that a compliance panel intervene.
The WTO panel on Thursday ruled mostly in favor of the U.S. The international body, which helps solve trade disputes, found the EU had provided billions of dollars more in subsidies, causing lost sales worth tens of billions of dollars for Airbus’ archrival Boeing Co.
The WTO, however, found that EU financing was acceptable for some Airbus models — notably the A380, the massive double-decker plane meant for long hauls.
Boeing praised the overall ruling, which the EU can appeal, saying the “day of reckoning” has finally arrived. It went so far to say that Airbus might not even exist today if not for continued support of European governments.
“Today’s historic ruling finally holds the EU and Airbus to account for their flouting of global trade rules,” Boeing CEO Dennis Muilenburg said in a statement. “This long-awaited decision is a victory for fair trade worldwide and for U.S. aerospace workers, in particular.”
United States Trade Representative Michael Froman says the finding is “a sweeping victory for the United States and its aerospace workers.” He called on the EU, Germany, France, the United Kingdom and Spain to “respect the WTO rules” and “end subsidized financing of Airbus immediately.
This decision is independent of the EU’s case against the United States, in which the WTO is considering whether Boeing received banned federal and state support in the U.S.
“Watch this space,” Airbus said in a statement in reaction to Thursday’s ruling. “Before year-end the record subsidies for the 777X will almost certainly be condemned as illegal,” it said, referring to a new Boeing airliner.
The Boeing Company is the only American producer of large civil aircraft and is the largest single U.S. exporter. Boeing has major facilities around the country, including in Washington and South Carolina. Members of the Washington congressional delegation joined the administration in hailing the ruling, which has the potential to result in tariffs that would likely cost Airbus market share.
Sen. Maria Cantwell, D-Wash., called on the EU to come to the negotiating table and settle, rather than wait for future tariffs on Airbus planes.
“Without having to compete against illegal, market-distorting practices, Boeing should win more sales around the world,” Cantwell said.
Scott Mayerowitz in New York, Jamey Keaten in Geneva and Angela Charlton in Paris contributed to this report.