US, EU in war of words as WTO ruling on Airbus subsidies remains unclear

Both American and EU officials are now busy imparting their own interpretation to a World Trade Organization (WTO) ruling on illegal subsidies received by Airbus during development of the A380. The interim ruling has been delivered in a confidential format by the WTO leaving the aviation industry at large and the world in general in the dark as to its contents.

Judging by the drift of the statements being issued by the warring parties and other press reports it is being surmised that the 1,000-page preliminary ruling may have had adverse comments to make against the aid sanctioned to Airbus by various European governments.

The WTO ruling has come after five years of deliberations and acts on a US Trade Representative Office complaint against government sanctions provided to arch-rival Airbus. The Toulouse-based European manufacturer, in turn, has filed a counter-claim against Boeing for receiving subsidies from US government departments and agencies for the development of its futuristic aircraft, the 787 Dreamliner.

While sources told The Wall Street Journal that the ruling holds "every launch aid package given for the A380 passenger jet was an illegal subsidy," an Airbus spokesperson told Reuters that the WTO ruling"...won't change anything legally. This interim report is not more or less than a footnote."

Last Friday, even as the report had just been handed over the US-based Aerospace Industries Association released a statement by president and CEO (and former FAA Administrator) Marion Blakey as saying the trade group "welcomes the World Trade Organization ruling today as reported in the press that the European government's launch aid to Airbus is not consistent with its rules."

Blakey added, "While preliminary, the ruling provides much-needed guidance to WTO members that are involved in or considering entering into civil aircraft production" and constituted "an important step toward achieving a level and fair playing field that will allow the US aerospace industry to flourish in the international marketplace."