Europe claims victory after WTO delivers preliminary ruling on government aid to Boeing

Europe claims WTO ruling in Boeing case as victory

GENEVA — European officials claimed Wednesday that a preliminary decision by the world’s top trade court found that aid to U.S. aircraft maker Boeing violated international rules, leading to the prospect that the Chicago-based plane maker may have to forgo or even pay back billions in subsidies.

France’s transport and environment ministers said the confidential World Trade Organization ruling delivered to U.S. and EU officials in Geneva “condemns massive subsidies to Boeing that violate WTO rules.”

Details of the ruling weren’t made public and a final judgment isn’t expected to be released for several months.

It comes three months after the WTO found that Boeing’s European rival Airbus gained an unfair advantage through billions worth of low-interest government loans, infrastructure provisions, and research and development grants. Both Washington and Brussels have appealed that decision.

“The ruling swings the pendulum back,” the French environment and transport ministers, Jean-Louis Borloo and Dominique Bussereau, said in a joint statement. “This ruling brings enormous satisfaction to the French and European aviation industry and saves jobs and the future of this industry.”

The Office of the U.S. Trade Representative in Washington confirmed receipt of the ruling.

“This dispute has proven to be one of the most complex and lengthy disputes under the WTO,” said USTR spokeswoman Nefeterius Akeli McPherson. “As the interim report is confidential, we cannot discuss the contents.”

In a statement late Wednesday, Boeing said that if the European Union’s claims were indeed upheld by the WTO, the ruling represents “a massive rejection of the EU case and confirms that European launch aid to Airbus stands as the single largest and most flagrant illegal subsidy in the aerospace industry.”

The company also said the WTO findings against the U.S. are likely to require few changes in U.S. policies and practices.

Ahead of its release a senior Boeing official rejected suggestions that the ruling should be tied to the Airbus case, offering the way for a negotiated settlement between the two parties.

“The two cases are completely separate and deal with very specific issues,” Ted Austell, vice president trade policy at Boeing, said Tuesday.

John Clancy, an EU trade spokesman, said Wednesday’s ruling would be studied carefully before Brussels decides how to proceed. But he added that “only negotiations at the highest political levels can lead to a real solution and we hope today’s report provides momentum in that direction.”

The six-year dispute is seen as key to future funding for new plane development in a market estimated to be worth more than $3 trillion over the next two decades.

Airbus and Boeing are also vying to secure a $35 billion contract to provide aerial tankers to the U.S. Air Force.

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Associated Press writers Angela Charlton and Raf Casert in Brussels contributed to this report.