WTO to Establish Panel to Investigate Airbus Claims

The World Trade Organization (WTO) set up a panel on Tuesday to examine what the United States claims are further examples of illegal support by European governments for airplane-manufacturer Airbus.

The United States, in asking the WTO to open the formal investigation, said Airbus had benefited from millions in illegal launch aid, development financing, contributions and debt relief from the 25-nation European Union and its member states.

The EU had blocked Washington's first request for a panel, but cannot block it now that the United States has made a second demand.

The new panel is the latest step in a complex dispute, which started when the United States filed a WTO complaint against Airbus aid in 2004, and Brussels retaliated with a countersuit targeting subsidies to Chicago-based Boeing Co.

The U.S. says European government subsidies have distorted market prices and allowed the France-based manufacturer of jetliners to overtake Boeing as the biggest civil aircraft seller. The EU argues that the United States provides vast amounts of hidden support to Boeing through military contracts.

The WTO set up two panels in July to investigate the competing claims of wrongdoing. It created a third in February after Brussels said the United States failed to cooperate in providing information on 13 government subsidy programs that Washington argued were outside the scope of the investigation.

The EU said it was regrettable that the U.S. was making allegations based on "a perceived threat of subsidization," noting that European governments have yet to commit on investing in the A350 project.