Airbus and its four home countries—France, Germany, Spain and the UK—have made changes to reimbursable launch investment loans that they believe will bring the aid in compliance with World Trade Organization (WTO) rules.

“We are confident that we have now achieved full compliance in the DS316 case as a clear demonstration of the will to ensure a fair-trade environment respecting international trade agreements,” Airbus general counsel John Harrison said in a statement.

The measures follow a May 15 WTO Appellate Body ruling that launch aid on the A350 and A380 programs was improper. The appellate ruling left about $9 billion in subsidies in play on which the US said it would seek authority from the WTO to impose countermeasures, which would take the form of tariffs against European Union (EU) products.

The details of what Airbus has changed are confidential, although Airbus is understood to have agreed to repay a UK government-backed loan before the end of this year, which would be earlier than planned, and to not take some support as initially planned for the A350 program. Airbus said the changes “are aligned with current market conditions.”

US tariffs on EU products, to make up for the economic damage to Boeing the US said has been caused by the A350 and A380 launch aid to Airbus, are still conceivable. Airbus and EU officials believe that, following an expected WTO ruling later this year or next year on US federal and state government support for Boeing in the separate DC353 case, both sides can come to a negotiated settlement rather than introducing tariffs against each other.

In another formal step in the 14 year-long process, the EU has now notified the WTO of the changes Airbus has made.


Source: ATWonline/ May 2018

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