The EU Implements Additional 15 and 25 Percent Tariffs on $4 billion of U.S. Products
On November 10, 2020, the European Union (EU) implemented additional tariffs on an estimated $4 billion of U.S.-origin products after what it described as a “lack of progress” with the United States in resolving a long-standing trade dispute involving aircraft subsidies. The measures include additional 15% tariffs on U.S.-origin aircraft and 25% tariffs on a range of U.S.-origin agricultural and industrial products. The list of U.S. products affected includes tractors, cheese, spirits and orange juice.
Background
The EU and the United States have been at odds over specific aircraft subsidies provided by each government to its own domestic aircraft manufacturer, Airbus and Boeing, respectively, since 2006.
On October 13, 2020, the World Trade Organization (WTO) authorized the EU to implement additional tariffs on $4 billion of U.S.-origin products. The WTO had previously ruled on March 28, 2019, that U.S. subsidies of Boeing, including certain tax and other incentive measures, do not comply with WTO rules of trade.
Similarly, on October 2, 2019, the WTO authorized the United States to implement additional tariffs on $7.5 billion of EU-origin products, which the U.S. implemented on October 18, 2019. A 2011 WTO ruling had confirmed that EU subsidies to Airbus also do not comply with WTO rules.
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