U.S. and EU Set for a Clear Landing

    January 11, 2005

By agreeing to talks on eliminating billions of dollars in aircraft subsidies, the U.S. and European Union avoided legal conflict over Boeing and Airbus.

“During these negotiations, there would be both a ‘subsidies standstill’ and a ‘litigation standstill’,”‘ stated U.S. Trade Representative Robert Zoellick. “Each side would refrain from taking additional steps in the WTO process and from committing to any new government supports for large commercial aircraft.”

“To sharpen the focus of our work, we have agreed to use the definitions and framework of the WTO subsidies rules as the basis for an agreement,” he declared.

According to European Trade Commissioner Peter Mandelson, they had agreed to negotiate for 3 months in order to patch up their dispute over Boeing and Airbus, putting any prospect of litigation at the World Trade Organization on hold.

“Today’s agreement creates a positive atmosphere for more work to strengthen the economic partnership between the EU and the US, which is vital for both of us,” he said.

In a statement, Mandelson said, “With this agreement, the EU and U.S. have confirmed their willingness to resolve the dispute which has arisen between them … and to devote time and resources to doing so by negotiation rather than pursuing the dispute through WTO panels.”

Officials from the WTO have been concerned that the conflict between EU and U.S. over billions of dollars of support could damage the organization’s work.

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