On April 8, 2019, the US Trade Representative (USTR) stoked the fires of simmering trade dispute between the United States and the European Union. Specifically, the USTR posted a preliminary list of EU products that will be subject to additional duties upon importation into the United States as a result of a dispute over aircraft subsidies (the underlying dispute has been the subject of WTO litigation for many years).
The United States has requested permission to impose countermeasures (i.e., additional duties) against EU products worth $11.2 billion a year. The list includes aircraft and aircraft parts imported from France, Germany, Spain and/or the United Kingdom, as well as many other unrelated articles imported from any EU country (e.g., certain fish, cheeses, olive oils, wines, textiles, apparel, ceramics, metals, tools, motorcycles, lenses, oscilloscopes, etc.). The WTO is considering the appropriate amount of the retaliation and a final list will be published once that is done. In the meantime, interested parties may file comments with the USTR on what articles should be on the list.
The EU has also brought a case at the WTO regarding US-subsidies for domestic aircraft production. In response to the April 8 announcement that the United States was moving forward, the EU has said that it will also seek permission from the WTO to impose retaliatory duties on US-origin products under its case.
All companies that trade with the EU should review the preliminary list and consider their options. These duties are in addition to the duties the United States currently imposes on steel and aluminum, and is threatening to impose on automobiles and auto parts, from the EU under Section 232. The EU has imposed its own additional duties on US products and is threatening to add to that here.
We hope this is helpful. If you have any questions about these issues (including how to cope), please let us know. Author: Ted Murphy