USTR - January 11, 2005 Statement of U.S. Trade Representative Robert B. Zoellick Regarding U.S.-EU Agreement on Terms for Negotiation to End Subsidies for Large Civil Aircraft
Office of the United States Trade Representative

 

January 11, 2005 Statement of U.S. Trade Representative Robert B. Zoellick Regarding U.S.-EU Agreement on Terms for Negotiation to End Subsidies for Large Civil Aircraft
01/11/2005
 

"Today, I am pleased that the United States and the European Union have reached agreement on the terms of negotiation to end large commercial aircraft subsidies.

"There is much work to be done if we are to be successful in negotiating an ultimate agreement, but today does mark an important step in trying to end subsidies for large commercial aircraft.

"For the first time in this long-standing dispute, the U.S. and the EU have agreed that the goal should be to end subsidies.  To sharpen the focus of our work, we have further agreed to use the definitions and framework of the WTO subsidies rules as the basis for an agreement.  This approach should also help us to multilateralize the effort over time. 

"We agreed that our negotiations should be concluded within three months.  During these negotiations, there would be both a 'subsidies standstill' and a 'litigation standstill.' Each side would refrain from taking additional steps in the WTO process and from committing to any new government supports for large commercial aircraft.   

"I want to thank Peter and his team for their efforts and commitment to achieving a viable negotiating framework.  We look forward to working closely to reach an agreement over the next three months."

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Below is a copy of the U.S.-EU Agreement on Terms for Negotiation to End Subsidies for Large Civil Aircraft.

U.S.-EU Agreement on Terms for Negotiation to End Subsidies for Large Civil Aircraft.

1.       The objective is to secure a comprehensive agreement to end subsidies to large civil aircraft producers in a way that establishes fair market competition for all development and production of LCA in the European Union and the United States.

2.       At present, the companies concerned in the EU are Airbus and its principal shareholders, and in the US, Boeing.

3.       The agreement will be negotiated within three months.

4.       (a) The agreement will be negotiated between and apply to the United States and the European Union.

          (b) These parties will subsequently work together to broaden the agreement to include as parties other countries with civil aircraft industries, or countries with risk sharing roles relevant to the objective of the agreement.

5.       (a) During the negotiations the parties will not request establishment of WTO panels relating to the pending disputes.

          (b) During the negotiations, within the time frame foreseen in paragraph 3 above, the parties will make no new government support commitments for LCA development or production.

6.       The Parties will use the definition of subsidies in the ASCM. The parties will agree an illustrative list of subsidies to be covered by the agreement which elaborates the ASCM definition. They will use this list to reach agreement on which form of subsidy should be prohibited, actionable or permitted.

7.       The agreement will be enforced through transparency and strong dispute settlement procedures.

8.       In negotiating the agreement the parties will establish agreed terms and conditions under which either may withdraw at a future date.  On the one year anniversary of the agreement, the parties will review its operation, including whether progress on international participation in it is sufficient to prevent circumvention of its objectives and to justify its continuation. 

 
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