The World Trade Organisation (WTO) has ruled that subsidies given to Airbus, the aircraft manufacturer, by European governments including the UK were illegal.
The Wall Street Journal reported that the WTO had ruled in favour of the United States, which had brought the case against the European Union.
The judgement, which has not yet been published, is said to have found that loans from the UK, France, Germany and Spain were an illegal subsidy.
The Journal said that US trade officials were calling the ruling “a great victory”.
The case is the longest-running WTO investigation, having been started in 2004. However, even after the verdict had been published the two sides seemed to disagree over exactly what it said.
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“The ruling is not a black-and-white case. It simply is not a great victory for the United States,” one source told Reuters after reading the Wall Street Journal story. Another source pointed out that the draft WTO report had dismissed 70 per cent of the US claims over aircraft subsidies.
The EU has also brought a case against the US claiming that defence contracts from the Pentagon to Boeing also amount to a subsidy. A ruling in that case is expected in about six months and the two sides are likely to then attempt to reach an out-of-court settlement.
The EU partner nations have traditionally given Airbus repayable launch aid to help the company compete with Boeing. However, Airbus lost its underdog status in 2003 when it overtook the American company as the world’s largest manufacturer of commercial aircraft.
The US case was also triggered by the $3.7 billion in loans given to Airbus to help develop the A380 superjumbo earlier this decade.
The US alleged in its case against the EU that since its inception Airbus had received more than $15 billion in launch aid, which was an unfair subsidy.
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The WTO had been expected to side with the US in the case and the Airbus partner nations rushed to agree launch aid for a new plane, the A350XWB, earlier this summer.
The UK committed £340 million to the A350 last month in a deal that will see the plane’s wings designed and built in the UK, which will help secure 11,000 Airbus jobs in this country.
A spokesman for the US Trade Representative said: “We are still reviewing the interim report, which is about 1,000 pages long.”
Lutz Guellner, a spokesman for the European Trade Commissioner, said: “It is important to recall that this report is only half of the story and we await the interim report in the case launched by the EU against the US, which we expect to be issued in a few months.”