WTO confirms illegal subsidies to Boeing | Business| Economy and finance news from a German perspective | DW | 12.03.2012
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WTO confirms illegal subsidies to Boeing

The World Trade Organization (WTO) has upheld an earlier ruling whereby US aircraft maker Boeing received billions of dollars in subsidies in a bid to enhance its competitiveness vis-a-vis Europe's Airbus.

The World Trade Organization (WTO) reported on Monday it had upheld the largest part of an earlier ruling that US plane maker Boeing received billions in unlawful subsidies.

According to a statement of the WTO's appellate body, Boeing received between three and four billion euros ($3.9 to 4.25 billion) in illegal handouts for research projects and as a result of tax breaks.

"Today's ruling vindicates the EU's long-held claims that Boeing has received massive US government handouts in the past and continues to do so," EU Trade Commissioner Karel de Gucht said in a statement in Brussels. "The US should now put an end to such harmful subsidies."

The ruling is the latest move in the dispute between Boeing and Europe's Airbus. The dispute has been the world's largest and has lasted for seven years.

Distorted race for supremacy in the skies

The illegal handouts to Boeing have among other things enabled the US plane maker to launch its modern 787 Dreamliner, causing a serious disadvantage to Airbus.

But the WTO has in the past accused Airbus too of receiving large-scale illegal state aid totaling $18 billion.

Experts believe that the fierce legal battle between the two competitors will last for many more years and could disintegrate into various forms of retaliation, once the Geneva-based trade body's investigations are exhausted.

hg / mll (Reuters, AFP)