WTO's Boeing-Airbus ruling 'set for broad impact'
Photo Airbus
(GENEVA) - A forthcoming WTO ruling on a US complaint against European Union subsidies to Airbus is likely to have a broader impact on aerospace markets, a lawyer acting for Airbus' US rival Boeing predicted Wednesday.
A World Trade Organization panel is expected to deliver its full decision on the six year-old case on multi-billion dollar subsidies to the two sides in the coming weeks, in one of the biggest trade disputes the organisation has dealt with.
"This marks a significant step in the US challenge," Bob Novick, outside legal counsel for the US aerospace giant, told journalists.
"A final panel decision will establish clear guidelines for European governments and other countries about what type of financing is or isn't appropriate when building airplanes," he added in a phone briefing organised by the US company.
"The efforts to enter the space by others and how they enter that space with or without government support are of significance. This will be a document that will be looked at by other governments."
Some analysts believe a clear-cut judgment was unlikely given the complexity of the case.
Novick predicted that both Washington and Brussels could lodge appeals even if the WTO panel broadly finds that some European subsidies to Boeing's arch rival Airbus were illegal under world trade rules.
"Based on past experience one would expect a final appeal-adopted decision sometime in the late fall," he claimed.
The Geneva-based WTO confirmed last September that it had issued a confidential interim ruling on the dispute to the United States and the 27-nation EU, but few details have filtered out.
The US filed the WTO complaint in October 2004.
It said an accord that allowed Brussels to provide up to a third of development costs of new airliners was no longer valid since Airbus was now a major industry player and not the fledgling firm when the deal was struck.
Boeing said recently that it expected a ruling this month while the WTO has indicated that it should complete its work on the US complaint by April.
The EU has also filed a complaint against the United States on multi-billion dollar state aid to Boeing. A first interim ruling in that case is due to be delivered in June, according to the WTO.
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