The EU and the WTO Brussels, 21 July 2010
EU Appeals ’Airbus’ Panel Report in Large Civil Aircraft Dispute
The EU has lodged its appeal with the WTO Appellate Body on the panel report concerning Airbus support (DS316) issued on 30 June 2010. While the report sides with the EU in rejecting a significant number of US claims, there are other aspects of the report which need to be corrected or clarified.
The EU appeal covers a number of findings by the panel including that:
- certain instances of repayable launch investment (RLI) for the A380 are export subsidies
- a causal link between Airbus support and any adverse effects to Boeing has been established
- certain infrastructure measures taken by EU Member States for which Airbus pays market-based rent constitute subsidies.
EU Trade Commissioner Karel De Gucht stated: "The WTO dispute settlement systems rightly allows for appeal to correct any legal errors of the panels. This dispute is too important to allow the legal misinterpretations of the panel to go unchallenged. What is more, not appealing would allow for an unhelpful precedent for the WTO membership as a whole".
This dispute (together with that regarding subsidies to Boeing - DS353) is unprecedented in both its factual and legal complexity. It also covers a number of issues not yet settled in WTO case-law. A damaging precedent could arise if certain of the Panel's legal interpretations are allowed to stand, resulting not only in a disservice to the entire WTO membership but also putting an unwarranted burden on Airbus and the Member States concerned.
The US had requested a meeting of the WTO Dispute Settlement Body to take place on 21 July 2010 for purposes of the formal adoption of the panel report.
The EU, by submitting its notice of appeal prior to the actual meeting, has indicated that it is appealing the Panel report, thereby preventing its formal adoption.
While the timeline for the appeal process (through the WTO Appellate Body) is shorter than that of panels, i.e. normally 90 days, it is not unusual that proceedings for more complex disputes such as this one require more time.
The WTO interim panel report in the EU challenge of support to Boeing is due by mid-September 2010.
Read the notification of appeal
From 1992 onwards, the EU and the US were bound by a bilateral agreement which regulated government support for large civil aircraft. The US unilaterally dropped this agreement in October 2004 and started WTO litigation. The WTO panel began its work in 2006 and the publication of its final panel report on the 'Airbus' case on 30th June 2010 marked the end of the first phase of litigation. With the EU's notice of appeal, the second phase of the litigation will commence in this case.
For further information
Background factsheet: EU/US large civil aircraft disputes
The WTO Report DS316