AIRCRAFT SUBSIDIES RULING DELAYED UNTIL JULY 2008

The WTO dispute panel reviewing part of the EU-US spat over billions of dollars of aircraft subsidies has announced that it will issue its decision in July 2008, over a year later than would be expected under the standard timetable.

The chair of the panel examining Brussels' complaint about US aid to aircraft manufacturer Boeing, circulated a written communication on 18 May stating that "the substantive and procedural complexities" of the dispute made it impossible to conform with the standard six-month timeframe that started when the panel was created in November 2006.

Indeed, the fight over aircraft subsidies, which also involves a US claim against EU payments to Airbus, is in financial terms the biggest dispute ever brought before the WTO. Brussels claims that the Boeing has benefited from USD 23.7 billion in illegal subsidies from the US government, including USD 4 billion in tax breaks and more than USD 16 billion in research and development support funneled through NASA and the Defense Department. For its part, Washington has filed complaints against Brussels, alleging that EU member states have collectively provided Airbus with more than USD 100 billion in illegal aid. A ruling on the latter dispute is expected no earlier than September.

According to WTO rules, if the members of a dispute panel feel that they will be unable to meet the six-month deadline, they must both inform Members of the reasons for the delay and indicate when they expect to issue the final ruling.

Long delays in contentious WTO disputes are not unusual: last year's high profile ruling on the EU's procedures for approving genetically modified organisms came nearly three years after the US, Canada, and Argentina filed their complaint.

ICTSD reporting; "EU says U.S. gave Boeing $23.7 bln in illegal aid," REUTERS, 23 March 2007; "Airbus got $100 bln in illegal subsidies says US," REUTERS, 21 March 2007.