EU imposes criminal duties on US

EU trade ministers agreed on Monday to this move several weeks after the World Trade Organisation (WTO) arbitrators were decided. The EU allowed sanctions to be waived if the US abolished its own criminal duties imposed on EU imports in response to the unlawful public aid to the rival Boeing Airbus.

"Unfortunately, despite our best efforts to make progress on the part of the US, we can confirm that the European Union will benefit from our rights today and impose the countermeasures granted to us by the WTO," said Vice-President Valdis Dombrovskis at a press conference following a video conference of ministers from the European Commission.

The Minister of Economy holding the German Presidency Peter Altmaier pointed out that this step was logical and most Member States agreed to it. As he explained, the US tariffs on EU goods and services have been in force for over a year.

"Only around February or March we will find out exactly who in the new administration has the right to speak in this important area, so now it was necessary to find a solution in the hope that this would prevent further escalation," he said referring to the outcome of the presidential election.

Representatives of EU institutions and capitals hope to change US policy after Democratic Joe Biden took office in January. Dombrovskis welcomed Biden's commitment to international alliances, the multilateral system and the improvement of ties with the EU.

Altmaier pointed out that most European countries see Biden's victory "as an opportunity to adopt a new approach to our trade relations and solve trade conflicts" which the US has with the EU.

As early as March 2019, WTO arbitrators ruled that despite questioning state aid to Boeing, the company had used it for a number of years. The further investigation concerned only the extent of the sanctions. Considered illegal aid include grants for research and development from NASA's government space agency and tax reliefs. This also supported the design and production of the Boeing 787 Dreamliner passenger aircraft.

The EU and the US sued WTO aid to Boeing or Airbus in 1995. In October 2019, the arbitrators allowed the United States to impose criminal duties as Airbus subsidy continued until then. The USD 7.5 billion per year value of goods covered by these duties has been highest since the WTO was established in 1995. They are mainly used against four financially supporting Airbus countries – France, Germany, Great Britain and Spain.

Source: PAP