On 13 October 2020, a WTO arbitrator issued its decision on the level of countermeasures the European Union may request with respect to 16-year old dispute with the United States involving subsidies to Boeing in “United States — Measures Affecting Trade in Large Civil Aircraft — Second Complaint” (DS353). The United States had previously won a parallel case involving European subsidies to Airbus and assessed tariffs against European goods worth approximately USD 7.4 Bn. In the current case, the arbitrator decided that the European Union may request authorization from the DSB to take countermeasures with respect to the United States at a level not exceeding, in total, USD 3,993,212,564 annually. These countermeasures may take the forms enumerated below:
- suspension of tariff concessions and other related obligations under the GATT 1994 on a list of US products to be established in due course;
- suspension of concessions and other obligations under the SCM Agreement; and
- under the GATS, suspension of horizontal or sectoral commitments contained in the consolidated EU Schedule of Specific Commitments, as supplemented to incorporate the individual Schedules of Specific Commitments of its Member States, with regard to all principal sectors identified in the Services Sectoral Classification List.
The EU published an 11 page preliminary list of goods that would be subject to retaliatory tariffs last year, that included video game consoles, tractors, handbags, luggage, tobacco, wine, cheese. It is not clear when the final list will be issued. Both parties to the disputes have indicated a willingness to negotiate a resolution to both cases.
