US files subsidies complaint against EU

The US is to file a complaint against the EU to the World Trade Organisation, contesting what they regard as billions of euro in unfair subsidies provided to Airbus by European governments.

The Office of the United States Trade Representative announced the action in Brussels, saying that recent negotiations between the two countries failed to resolve the dispute.

“This is about fair competition and a level playing field,” trade representative Robert Zoellick said.

“Since its creation 35 years ago, some have justified subsidies to Airbus as necessary to support an infant industry. If that rationalisation were ever valid its time has long passed. Airbus now sells more large civil aircraft than Boeing,” he said.

The dispute involves two large aircraft companies – Boeing against Airbus.

They compete in a wide range of civilian and military aircraft markets, and Airbus has over the past decade supplanted Boeing as the world’s biggest aircraft manufacturer.

The United States and EU agreed in 1992 on a deal which limited subsidies for the world’s two largest aircraft makers to 33% of the production costs for new models.