Increasing The Additional Duty Rate Imposed On Aircraft Imported From The EU To 15 Percent

Under President Trump's leadership, the United States won the largest award in WTO history on October 2, 2019 when it was authorized to take countermeasures on $7.5 billion in goods after a victory in its unfair trade practices case against the European Union, France, Germany, Spain, and the United Kingdom.

Pursuant to U.S. statute, the United States Trade Representative is now issuing a Notice in the Federal Register making adjustments to its WTO-authorized retaliation action, which was implemented on October 18, 2019. The United States is increasing the additional duty rate imposed on aircraft imported from the EU to 15 percent from 10 percent, effective March 18, 2020, and making certain other minor modifications.

According to the notice, as of this time, the Trade Representative has decided not to increase the rate of additional duties above the additional 25 percent currently being applied to nonaircraft products. The U.S. Trade Representative has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on U.S. products in connection with the Large Civil Aircraft dispute or with the EU’s WTO challenge to the alleged subsidization of U.S. large civil aircraft.

In a statement, Airbus said it "deeply regrets" the ruling.

"USTR’s decision to impose tariffs further escalates trade tensions between the US and the EU, thereby creating more instability for US airlines that are already suffering from a shortage of aircraft," the statement said.

"USTR’s decision ignores the many submissions made by US airlines, highlighting the fact that they – and the US flying public – will ultimately have to pay these tariffs. Airbus will continue its discussions with its US customers and work with them to mitigate effects of tariffs insofar as possible.

"Airbus has and will continue to push for a negotiated settlement to this 15-year-long dispute. USTR’s further escalation complicates efforts to find a negotiated outcome to this dispute. This is regrettable.

"Airbus hopes that USTR’s position will change, especially when the WTO will authorize the EU to impose tariffs on Boeing aircraft, including the 737Max, 787 and 777 aircraft in the May/June timeframe."

(Source: USTR and Airbus news releases)

FMI: ustr.gov
www.airbus.com