Europe Demands U.S. Drop Tariffs After Member States Comply With Airbus Ruling

The European Commission wants the United States to scrap tariffs on a range of manufactured and agricultural goods now that E.U. states found to be providing illegal subsidies to Airbus have complied with WTO demands.
Aug. 4, 2020
Costas Vasilopoulos

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The European Commission has called on the United States to lift the tar­iffs it imposed on a range of European imports last year.

The Commission said that the gov­ern­ments of Germany, France and Spain have fully com­plied with the require­ments of the World Trade Organization, after the inter­na­tional trade body ruled that the three had pro­vided ille­gal sub­si­dies to the air­craft man­u­fac­turer, Airbus.

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Tariffs worth $7.5 bil­lion were intro­duced last October by the U.S. Trade Representative, affect­ing a wide range of European agri­cul­tural and man­u­fac­tur­ing goods, includ­ing pack­aged olive oils from Spain and some table olives from France and Spain.

The three mem­ber states agreed to make mod­i­fi­ca­tions to the ini­tial terms of financ­ing the aero­nau­tics com­pany, accord­ing to the WTO rec­om­men­da­tions, and end a 16-year-long dis­pute with the orga­ni­za­tion. As a result of the set­tle­ment, the Commission asserted that the U.S. tar­iffs are ground­less and requested that they be dis­missed.

Unjustified tar­iffs on European prod­ucts are not accept­able and, aris­ing from the com­pli­ance in the Airbus case, we insist that the United States lifts these unjus­ti­fied tar­iffs imme­di­ately,” Phil Hogan, the E.U. Commissioner for Trade, said.

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The E.U. has made spe­cific pro­pos­als to reach a nego­ti­ated out­come to the long run­ning transat­lantic civil air­craft dis­putes and remains open to work with the U.S. to agree a fair and bal­anced out­come, as well as on future dis­ci­plines for sub­si­dies in the air­craft sec­tor,” he added.

Hogan also threat­ened retal­ia­tory mea­sures in case the duties are not lifted by the U.S., pend­ing the deci­sion of the WTO on a sim­i­lar case regard­ing the United States pro­vid­ing ille­gal sub­si­dies to American air­craft man­u­fac­turer, Boeing.

In the absence of a set­tle­ment, the E.U. will be ready to fully avail itself of its own sanc­tion rights,” Hogan said. The WTO will soon issue its arbi­tra­tion deci­sion in the par­al­lel case of the E.U. against the United States on cer­tain unlaw­ful sub­si­dies to Boeing, where the appel­late body had found the U.S. to be in breach of its WTO oblig­a­tions.”





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