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Boeing awaits WTO verdict on U.S. government support

Published 09/15/2010, 06:34 AM
Updated 09/15/2010, 06:36 AM

* Confidential ruling to be distributed later on Wednesday * Findings could colour battle over EU, U.S. aircraft aid

GENEVA, Sept 15 (Reuters) - Boeing awaited a World Trade Organisation ruling on Wednesday on the legality of U.S. government support for its operations that could colour a trans-Atlantic aircraft industry dispute.

In a statement released ahead of the circulation of the confidential verdict, Boeing pointed to a June WTO ruling in a parallel dispute against the European Union that found some of the "launch aid" its rival Airbus got from Brussels violated global trade rules.

"We look forward to hearing how the WTO ruled in today's preliminary decision on U.S. practices, none of which have the market-distorting impact of launch aid nor even approach the sheer scale of European subsidy practices," Boeing said.

Though the two cases are being arbitrated separately at the WTO, they are part of a tit-for-tat battle pitting Brussels against Washington on behalf of their respective aircraft manufacturers.

Officials on both sides of the Atlantic believe the WTO findings on Boeing will give a fuller picture of what kind of government support is acceptable in the sector. Many expert the two sides to negotiate a new agreement to resolve their spat.

Washington has a slight tactical advantage because it would be in a position to impose trade retaliation earlier than Brussels can if the U.S. victory against Airbus subsidies is upheld on appeal.

The full WTO panel report on Boeing that will be distributed to U.S. and EU officials on Wednesday is not expected to be made public for months, perhaps not until mid-2011. (Reporting by Laura MacInnis; editing by Philippa Fletcher)

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