The ruling is based on an accusation that the EU gave illegal subsidies to Airbus.
After the WTO gave the US the green light to go ahead with tariffs, the tariffs were put in place as the EU pledged to show more restraint going forward.
The 15-year battle between the US and EU over illegal subsidies for aircraft manufacturer Airbus just took a turn. The WTO has now ruled that the EU subsidies are illegal, opening up the possibility of further tariffs. The ruling will allow the US to place tariffs on European goods including aircraft, olives, and cheese, among other goods. Following the US announcement of tariffs, the EU has threatened to respond with tariffs of its own against US goods.
American trade officials have announced that the tariffs applied against the EU will be set at a 10% rate for European aircraft, and a 25% rate for European agricultural goods and several other items. The American officials have published a list of the goods that will be affected by the new tariffs. These tariffs will primarily affect imports from France, Germany, the UK, and Spain. The American officials have also claimed the authority to increase the tariffs “at any time,” or make changes to the list of affected goods.
At the same time as this WTO ruling has come out, the WTO is working to decide on what kinds of tariffs the EU can impose on the US over state aid given to Boeing. That ruling is expected to come at some point in 2020. The European commission has proposed tariffs equal to $20 billion on US goods, but has expressed hopes that the two sides can reach an agreement beforehand. “But if the US decides to impose WTO authorized countermeasures, it will be pushing the EU into a situation where we will have no other option than do the same,” the European Commission said.