Nations urge WTO appeal

08:49, July 21, 2010      

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Airbus nations urged the European Union to appeal against a global trade ruling condemning loan payments to the aerospace firm and pledged to continue discussing financing for the A350 jetliner.

The ruling from the World Trade Organization failed to establish that Europe's system of aircraft loan financing as a whole was at fault, European officials said.

Ministers from France, Germany, Britain and Spain - the four countries that founded Airbus 40 years ago - discussed the issue on the sidelines of the Farnborough Airshow in England. Airbus and Boeing scooped up orders worth $23 billion at the show Monday from airlines and leasing firms seeking to meet soaring Asian demand for air travel.

"It is an unfair situation. All four of us deplore it and our wish is that the (European) Commission appeals as quickly as possible," French Transport Minister Dominique Bussereau said Monday.

"France believes the WTO panel confirmed that the principles of reimbursable advances do not contravene WTO rules," he told a news conference.

Airbus is in talks with European governments to obtain further loans for development of its future A350 jetliner, to be paid back from a royalty on future sales of the plane.

"I can say we are encouraged by progress to date," Mark Prisk, junior British minister for business, said of the talks.

"Clearly it's a complex set of negotiations and obviously all of us are committed to acting consistently with our international obligations, as you would expect."

Ministers said France was in discussions to supply 1.4 billion euros ($1.8 billion), Germany 1.12 billion euros ($1.4 billion), Spain 332 million euros ($429 million) and Britain 340 million pounds ($520 million) in A350 development loans.

Boeing says such loans are unfair and should be withdrawn. It reiterated calls for future loans to be on a commercial footing.

"The WTO has set a clear legal principle that government loans to Airbus must be on commercial terms, otherwise they are an illegal subsidy and inconsistent with WTO rules," Boeing spokesman Charlie Miller said.

The WTO said last month three European countries had given prohibited export subsidies as loans for the A380 superjumbo.

Prisk said the four countries were unhappy about a WTO decision to delay ruling on an EU counter-case, which alleges that Boeing received illegal aid in research grants.

The European Union has until July 21 to appeal in the original case brought by the United States and is expected to do so - a move that legal experts say would trigger a US counter-appeal.

Source: Global Times


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