On Wednesday, October 2, 2019, the World Trade Organization (WTO) allowed the U.S. to set duties on $7.5 billion worth of European Union (EU) goods as a consequence of the long-running legal battle over subsidies to Airbus. The U.S. originally asked for authorization to impose duties on $11 billion of EU goods; the WTO arbitrator has calculated the lower $7.5 billion amount for the actual retaliation.  A series of WTO panels have been examining the details since 2004 and determined that the EU illegally subsidized the launch of the Airbus A350 and A380 twin-aisle jets. The EU is seeking a similar ruling in its parallel case against U.S. subsidies granted to Boeing. It has requested the WTO to authorize duties on $12 billion worth of U.S. goods, an action which could be finalized next spring.

This ruling from the WTO against Airbus allows President Trump’s administration to set increased import duties on large civil aircraft and parts imported from the EU, as well as EU wines, cheeses, motorcycles and apparel luxury items such as men’s suits and handbags.