The World Trade organization (WTO) upheld its decision on Friday that Washington provided illegal tax breaks to aircraft maker Boeing in a trade ruling that favors European Union rival Airbus.
The WTO ruled in its compliance panel report that "the European Union established that the effects of the Washington state tax rate reduction are a genuine and substantial cause of significant lost sales of A320neo and A320ceo families".
The US tax break is also "a threat of impedance of imports of the A320ceo to the United States" and a threat of impedance of exports to the United Arab Emirates, the report said.
Boeing's logo is seen above the front doors of its largest jetliner factory in Everett, Washington, US January 13, 2017. /Reuters Photo
However, the WTO rejected the EU's claims that certain aeronautics R&D subsidies and other subsidies cause a significant loss to Airbus.
It found that one US subsidy program, a business tax rate reduction in the state of Washington, where Boeing builds most of its aircraft, had "adverse effects", involving customers from the United Arab Emirates, Canada, and Iceland.
"The panel found only one state-level program, which had an average value of 100 to 110 million US dollars in the 2013-2015 period, to be contrary to WTO rules." the office of the US Trade Representative said.
Boeing and its European rival, Airbus, have been in an exhausting 13-year-old trade battle, in which each company accuses the other of taking billions of illegal state aid.
The logo of Airbus is pictured at the entrance of the Airbus facility in Bouguenais, near Nantes, France March 20, 2017. /VCG Photo
A US tribunal agreed separately to investigate Boeing's concerns about alleged price-dumping by Canada's Bombardier.
The EU requested the WTO to establish a panel to probe into alleged US subsidies of up to 19.1 billion US dollars through tax and non-tax incentives by various municipalities to its largest aircraft maker Boeing in January 2006.
The panel report over the case came out in March 2011. Both of them later on decided to appeal to the appellate body, which released its final report in March 2012.
The US said afterwards that it intended to implement the recommendations and rulings in the Boeing case within six months.
This file photo taken on March 7, 2017 shows the Boeing logo on the Boeing 737 MAX 9 airplane during its rollout for media at the Boeing factory in Renton, Washington. /VCG Photo
However, Airbus insisted the United States had not complied with the WTO's earlier decisions in the case and claimed it had suffered $100 billion of harm when combined with a follow-up complaint.
"The amount of money involved completely distorts trade ...and the WTO should make it clear that no government or company can escape from their international responsibilities," Airbus Chief Executive Tom Enders said in a statement.
The WTO said Boeing had failed to comply with part of the earlier 2012 ruling relating to tax breaks in Washington state.
Those tax breaks are now the subject of a new case, having been extended to cover Boeing's newest wide-body jet.
(Source: Xinhua, Reuters)
