Saturday

4th Dec 2021

Airbus calls for end of legal battles with Boeing

  • A Boeing 777. (Photo: Sebastien Lebrigand)

Airbus has called for a global agreement on subsidies for the aircraft industry, after the World Trade Organisation (WTO) ruled that Boeing benefited from illegal US tax breaks.

In the case brought by the EU against the US, a WTO panel ruled that Boeing had benefited from illegal tax breaks facilitating the development of its new B777X jets.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

The panel also found that the US had discriminated against foreign suppliers because Boeing had agreed to use domestically produced wings in exchange for the scheme.

The case is part of a series of disputes - in September the WTO had said the EU had "failed to comply" with an earlier ruling to remove subsidies for Airbus.

The European plane-maker said on Monday (28 November) the latest ruling was a "knockout blow" to Boeing's "record-breaking subsidies".

The European Commission, which represented Airbus before the WTO, also celebrated the report. "We won the WTO dispute on Boeing," the EU executive tweeted, adding in a press release that Boeing had been set to gain €5.4 billion from the measure.

However, Boeing's lawyer J Michael Luttig noted the WTO had rejected almost all of the objections raised by Airbus and the EU, and also hailed the the ruling as a "complete victory".

The US company also pointed out that it had yet to benefit from the scheme, which was not due to roll out until 2020.

On Monday, both parties said they expected the other "losing" side to appeal the latest ruling, which is likely to drag on for more years.

Legal battles

The rows mask deeper unease about the future of the industry.

“This WTO battle is a battle of the past which benefits only the armies of lawyers both sides employ for more than a decade,” said Airbus chief executive Tom Enders in a written statement.

"I continue to think that the only way out of the ridiculous series of disputes … is to agree on a set of globally applicable rules for the support of the civil aircraft industry, which would benefit both sides of the Atlantic."

Enders, whose company is set to announce on Tuesday several hundred staff lay-offs in France and Germany, was highlighting the need for Airbus and Boeing to adapt to a new environment.

The two plane makers, which currently dominate the global aerospace industry, have for years been embroiled in legal conflicts over subsidies. Each party has won and lost battles, as both are dependent on aid.

At the end of the process, the ruling may not have any real effect because the WTO has no enforcement powers of its owns.

The EU could introduce sanctions on the US, but WTO members rarely do that because such steps risk triggering retaliatory tariffs on other products.


The prospects of such a trade war have been further heightened by the election of Donald Trump in US, who has expressed doubts about the international trade order.

Meanwhile, governments of Canada, Russia and Asia have also started to subsidise their own plane makers, threatening the domination of Airbus and Boeing.

EU delays decision on trade defence

Trade ministers send a discussion on the level of import duties back to diplomats, also admitting that TTIP talks with the US are "in the freezer".

Luxembourg tax scandal may prompt EU action

An investigation into Luxembourg's tax regime has uncovered how the Italian mafia, the Russian underworld, and billionaires attempt to stash away their wealth. The European Commission has put itself on standby amid suggestions changes to EU law may be needed.

News in Brief

  1. Covid: Belgium might close schools and cultural activities
  2. EU consumers can sue Facebook, judge advised
  3. French centre-right tilts toward Pécresse
  4. EU urged to blacklist Israeli spyware firm
  5. Austria's ex-chancellor Kurz quits politics
  6. EU agency: Omicron to be over half of infections 'within months'
  7. New German restrictions target the unvaccinated
  8. EU commission unveils proposal to digitalise justice systems

Vietnam jails journalist critical of EU trade deal

A journalist who had demanded the EU postpone its trade deal with Vietnam until human rights improved has been sentenced to 15 years in jail. The EU Commission says it first needs to conduct a detailed analysis before responding.

Stakeholders' Highlights

  1. Nordic Council of MinistersNew report reveals bad environmental habits
  2. Nordic Council of MinistersImproving the integration of young refugees
  3. Nordic Council of MinistersNATO Secretary General guest at the Session of the Nordic Council
  4. Nordic Council of MinistersCan you love whoever you want in care homes?
  5. Nordic Council of MinistersNineteen demands by Nordic young people to save biodiversity
  6. Nordic Council of MinistersSustainable public procurement is an effective way to achieve global goals

Latest News

  1. Belgium tightens Covid rules as health system 'is cracking'
  2. EU and US tighten screw on Lukashenko
  3. Belgian impasse leaves asylum seekers on snowy streets
  4. EU 'missed chance' to set fossil-fuel subsidies deadline
  5. EU energy ministers clash amid gas price uncertainty
  6. ECJ told to dismiss Poland and Hungary rule-of-law challenge
  7. Covid: what Germany got right - and wrong
  8. Quick Take: Enrico Letta

Join EUobserver

Support quality EU news

Join us