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.

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.

“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.”