WTO backs Airbus in subsidy row with US

The long-running investigation into state support for airlines in Europe and the US moved closer to a resolution yesterday when the WTO said that while EU loans to Airbus constituted subsidies, the majority of the US claims were unfounded. The EU is also claiming that US subsidies for Boeing are also unlawful. Airbus said that it would study a ruling that past loans constituted subsidies, but claimed that the WTO had rejected 70 per cent of US claims.

Airbus yesterday issued a statement saying that the WTO had ruled that the so-called "European reimbursement loan mechanism" was legal and a "compliant instrument of partnership between government and industry". The group conceded, however, that the WTO had decided that past loans "contained a certain element of subsidy".

Maggie Bergsma, an Airbus spokeswoman, said: "The panel has now reconfirmed what we have always said: reimbursable loans are a legal instrument and they have not caused one single job loss to the US aerospace industry. Instead, Airbus has brought competition, ensuring healthy choice for our customer airlines."

Airbus also argued that the WTO ruling had found that none of its arrangements had caused "material injury" to any US interest. "This means that the panel has rejected the US claims that European measure caused job losses or lost profits in the US aircraft industry. Boeing claims of lost US jobs have now been judged and found to be false," the group said.