U.S. Hikes Tariffs on EU Planes in Airbus Dispute
March 23, 2020
On February 14, 2020, the Trump administration announced that it would increase its retaliatory tariff on European Union (EU) aircraft from 10% to 15% in the long-running World Trade Organization (WTO) battle over illegal subsidies granted to Airbus. The original 10% tariffs on aircraft from Europe were approved after a 15-year legal fight at the WTO ultimately found that the EU illegally supplied subsidies to Airbus. Under U.S. law, tariffs issued pursuant to a WTO proceeding may be adjusted 120 days after a ruling, and then every 180 days after that. Based on industry comments received, the U.S. decided to raise the tariff on European aircraft by 5%. The EU is currently seeking permission from the WTO to enact its own tariffs on aircraft based on U.S. subsidies to Boeing, which the U.S. Trade Representative has acknowledged would be taken into account in determining any future tariff increases by the U.S.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Andy Orr (aorr@eckertsemans.com or 202-659-6625).
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