EU initiates new WTO compliance proceedings over Airbus subsidies

GENEVA - The European Union (EU) requested dispute consultations with the United States at the World Trade Organization (WTO) to address the EU's claim that it and its member states have complied with the WTO ruling on subsidies to Airbus.

The WTO said the request was circulated to members on Wednesday.

The EU explained in a document submitted to the WTO that the request for consultations was made with respect to a "disagreement", under a dispute settlement understanding as to its "consistency with a covered agreement" of measures taken to comply with the recommendations and rulings" of the Dispute Settlement Body (DSB) between the two countries in their dispute over civil aircraft.

The WTO lately upheld its decision that the European Union (EU) and four of its member states -- France, Germany, Spain and the United Kingdom -- failed to fully comply with an earlier WTO ruling, by maintaining illegal subsidies for aircraft maker Airbus.

The United States has accused European governments of providing favorable loans to Airbus for its A380 superjumbo and the A350 long-range jet that compete with Boeing's 747 jumbo jet and 787 Dreamliner, respectively.

The EU said in response that it has achieved "full compliance with the recommendations and rulings in the present dispute."

The EU said the DSB's compliance panel report, as modified by the Appellate Body, has now been withdrawn and that the passage of time has also weakened the causal link between the subsidies mentioned in the dispute.

Under WTO rules, the United States can now take steps to establish the level of sanctions it may impose on European exports.