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The dispute between the European Union, the United States and Boeing may end soon

At a press conference after a one-day meeting of EU foreign and trade ministers, Valdes Dombrovskis stressed that the two sides are working to end the dispute with the goal of meeting the deadline.

He said the European Commission is in extensive and wide-ranging discussions with US High Representative for Trade Catherine Tay, who confirmed the roadmap by joining a videoconference of EU ministers on Thursday.

The European Union and the United States agreed in early March to suspend all criminal duties for a period of four months on each other’s exports to European Airbus and US Boeing aircraft manufacturers, which the World Trade Organization has declared illegal.

Dombrovskis previously indicated that the purpose of the suspension is to complete the necessary internal procedures for the permanent elimination of tariffs. He added that negotiations at the time of suspension could allow them to focus on resolving the nearly two-decade-old conflict.

If no agreement is reached by July 10, tariffs will be re-enforced on July 11.

There has been discussion since 2004 between the United States and the European Commission, which represents Germany, France, Britain and Spain, about support for the world’s two largest aircraft manufacturers, Boeing and Airbus. The World Trade Organization (WTO) dispute settlement body condemned the European Union in May 2018 and the United States in April 2019.

In October 2019, a three-member World Trade Organization arbitration court ruled that $ 7.5 billion annually in damage to the United States caused by illicit subsidies from the European Union in the form of loans to Airbus. So it allowed the United States to impose penalties of 10 and 25 percent, respectively, on a European product of $ 7.5 billion.

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The decision on the union’s claim over $ 10 billion should have been taken in the spring of 2020, but the coronavirus epidemic has delayed that. The European Union announced in November 2020 that it would introduce new tariffs on US imports due to prohibited subsidies for the US aircraft manufacturer by Boeing under the ruling of the World Trade Organization. In October 2020, the World Trade Organization allowed the European Union to impose punitive duties on a US product worth $ 4 billion in exchange for illegal subsidies for Boeing.

Since the WTO decision last year, the two sides have taken steps to meet global standards. For example, Washington state has withdrawn tax credits for Boeing, and Airbus has amended its agreements with the French and Spanish governments to pay higher interest on government loans to develop an A350.

Cover photo: Getty Images

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