EU rejects US claims on subsidies to Boeing

US aircraft giant Boeing was still getting government subsidies despite Washington's claim to have stopped the handouts, the EU said yesterday in the latest round of the world's biggest trade dispute.

"We had expected that the US would have finally complied in good faith with its international commitments and would have abided by the WTO rulings that clearly condemned U.S. subsidies to Boeing", EU trade commissioner Karel De Gucht said in a statement.

The EU's claim comes a day following the US Trade Representative's office saying it had complied with a ruling by a World Trade Organisation dispute panel that found Boeing had benefited from illegal payments. The deadline for complying with the ruling was 23 September.

"We are disappointed that this does not seem to be the case. So, the US leaves us with no other choice but to insist on proper compliance before the World Trade Organisation. We are confident that this process will finally lead to a level playing field in the aircraft sector."

According to a spokeswoman for the US Trade Representative (USTR)'s office, the US was confident it had fully complied with the WTO ruling against US subsidies for Boeing, but was still studying the EU's claim it had not.

USTR spokeswoman Andrea Mead said, based on its initial review, the EU simply did not account for many of the changes announced by the US. She added that EU included programmes in its request that US had made clear had been terminated.

The two sides have 15 days to enter into talks to resolve the dispute, according the European Commission's statement, following which the  EU could go to a WTO panel to review the issue.

While the US had complied with the trade arbiter's ruling, Airbus and government supporters in Europe had brazenly flouted the WTO by keeping subsidies in place, according to a 23 September statement from Boeing.