The decision of the Washington administration to impose duties on additional types of products imported from the European Union, comes into force on Tuesday at 00.01 US East Coast time (08:01 Moscow time).
As a result, parts required for aircraft manufacturing, manufactured in France and Germany, will be subject to a 15% duty from January 12. As Reuters explains, the US has previously imposed a 15% duty on aircraft imported from the EU. However, these measures did not apply to the aircraft of the European Airbus Corporation (“Airbus”), assembled at a plant in the US state of Alabama. The introduction of tariffs for parts would effectively deprive Airbus of the ability to sell its products in the United States without paying additional duties. As a result, Reuters believes that “these aircraft are likely to be uncompetitive” in the US market.
In addition to duties on spare parts related to the aviation industry, additional duties of 25% are imposed on some wines, cognacs and a number of other types of alcoholic beverages from France and Germany.
The reason is a long-standing dispute
The actions of the US authorities represent a new step in a long-standing dispute between the US and the EU over subsidies to aircraft manufacturers. This is a lawsuit involving the American company Boeing (“Boeing”) and Airbus.
The trade conflict between Washington and Brussels over Boeing and Airbus has been going on since 2004. Both sides accuse each other of violating World Trade Organization (WTO) rules and providing their aircraft builders with unauthorized government subsidies. In 2019, the WTO dispute settlement body found violations of the organization’s rules in the Airbus case, which gave the legal right to impose countervailing duties from the United States. However, in 2020, a similar decision was made in favor of the EU in the Boeing case.
The administration of the incumbent US President Donald Trump, already in 2019, introduced customs tariffs against the EU in the Airbus case, totaling approximately $ 7.5 billion. In turn, the European Union in November introduced new tariffs on agricultural and industrial goods from the United States totaling $ 4 billion per year. The answer to this was another introduction of additional duties by the United States.
According to Washington, the EU, when imposing duties, used data from a period when trade volumes fell sharply due to the economic consequences of the pandemic. “As a result Europe imposed duties on much more [количество] goods than if she used [данные за] normal period, “- asserted in a statement released in late December by the Office of the US Trade Representative. – To maintain the proportionality of these actions, the United States is forced to change its reference period to that that uses [при расчетах] EU “. At the same time, Washington stressed that, given the consequences of the pandemic for world trade, the annual volume of duties levied will ultimately remain at about $ 7.5 billion, which is in line with the WTO arbitration decision.
According to Reuters, the European Commission (EC) criticized the introduction of additional duties, saying that Washington’s actions undermine the negotiation process between the parties on subsidizing the aviation industry. “The EU will interact with the new US administration to continue these negotiations and find a long-term solution to the dispute, ”the agency quoted the EC as saying. Trump’s term expires on January 20. On this day, Democrat Joseph Biden will be sworn in as the 46th President of the United States.