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AMSTERDAM/WASHINGTON, DC: May 15, 2018. As Donald Trump threatens European companies with sanctions following his withdrawal from the UN framework agreement with Iran on its nuclear programme, the World Trade Organisation Appellate Body has concluded that Boeing’s complaint of illegal subsidies to Airbus by some European governments is largely unproven under its rules.

According to the European Commission (EC), the WTO has determined “the majority of EU support to Airbus challenged by the US had expired in 2011” and the EU is not required to take any further action regarding state support for the A300, A310, A320 and A330/A340 aircraft models.

Boeing interprets the WTO ruling to say “the European Union has failed to honour multiple previous rulings and has provided more than US$22 billion of illegal subsidies to European aircraft maker Airbus”.

In a direct challenge to France, Germany, the UK and Spain, Boeing said the United States Trade Representative (USTR) can now seek remedies in the form of tariffs against European imports to the US.

A330 TAP“The authorized tariffs are likely to total billions in duties per year, unless and until Airbus addresses the illegal subsidies it received from European governments for its most recently launched airplanes,” the manufacturer continued.

"Today's final ruling sends a clear message: disregard for the rules and illegal subsidies is not tolerated. The commercial success of products and services should be driven by their merits and not by market-distorting actions," declared Boeing chairman and CEO Dennis Muilenburg.

On the other hand the EC and Airbus say the WTO Appellate Body rejected 94 percent of the 218 claims made by Boeing of “adverse effects” on its business, with just 14 instances of specific harm in relation to the A350 XWB and A380.

"Today the WTO Appellate Body, the highest WTO court, has definitively rejected the US challenge on the bulk of EU support to Airbus, and agreed that the EU has largely complied with its original findings,” declared EU Commissioner for Trade Cecilia Malmström: “Significantly, it dismissed the vast majority of the US claims that this support had damaged Boeing's aircraft sales.

“The EU will now take swift action to ensure it is fully in line with the WTO's final decision in this case. Also, we look forward to the upcoming ruling by the Appellate Body on US compliance with the WTO findings of the massive and persistent government support to Boeing," she added.

Airbus CEO Tom Enders commented: “Of course, today’s report is really only half the story – the other half coming out later this year will rule strongly on Boeing’s subsidies and we’ll see then where the balance lies.

“The result is simple: Airbus pays back its loans, Boeing pays back nothing and continues to exploit the generosity of the US taxpayer. Despite Boeing’s rhetoric, it is clear that their position today is straightforward healthy: they have half the market and a full order book, they have clearly not been damaged by Airbus repayable loans.”

A conciliatory Muilenburg concluded: "Now that the WTO has issued its final ruling, it is incumbent upon all parties to fully comply as such actions will ultimately produce the best outcomes for our customers and the mutual health of our industry.”

Pictured: The first A330neo for launch operator TAP Air Portugal has completed a four and a half-hour maiden flight prior to delivery this summer.

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