Source: OFFICE OF US TRADE REP, 6/15/21 The United States and the European Union today announced a cooperative framework to address the large
civil aircraft disputes. The agreement moves away from past confrontation in
pursuit of a cooperative future by suspending the tariffs related to this
dispute for five years. The U.S. and the EU also agreed to clear
principles, including their shared intent that any financing for the production
or development of large civil aircraft on market terms.
“After years of bitter litigation and weeks of intense diplomacy, we have reached a deal on a set of high-level principles that resets U.S.-EU engagement in the large civil aircraft industry,” said Ambassador Katherine Tai. “We are strongest when we work with our friends and allies, and the partnership with European Commission Executive Vice President Valdis Dombrovskis is a demonstration of that principle in action.”
“Our goal was clear – to forge a new, cooperative relationship in this sector so that our companies and our workers can compete on a more level playing field. The agreement includes a commitment for concrete, joint collaboration to confront the threat from China’s non-market practices, and it creates a model we can build on for other challenges.”
The
following general principles will guide the cooperation between the United
States and the European Union in this sector:
1. The two sides will establish a Working Group on large civil aircraft, to be led by each side’s respective Minister responsible for trade. The Trade Ministers will consult at least yearly. The Working Group will meet on request or at least every 6 months.
2.
The Working Group will seek to analyze and overcome any disagreements
that may arise between the sides. The Working Group will collaborate on
and continue discussing and developing these principles and appropriate
actions.
3.
Each side intends to provide any financing to its LCA producer for the
production or development of large civil aircraft on market terms.
4.
Each side intends to provide any funding for research and development
(R&D) for large civil aircraft to its LCA producer through an open and
transparent process and intends to make the results of fully government funded
R&D widely available, to the extent permitted by law. Each side
intends not to provide R&D funding or other support that is specific, to
its LCA producer in a way that would cause negative effects to the other side.
5.
The two sides will continue discussions to further operationalize
paragraphs 3 and 4, which apply to all levels of government.
6.
Each side intends to collaborate on jointly analyzing and addressing
non-market practices of third parties that may harm their respective large
civil aircraft industries. The two sides will implement the annexed
understanding on cooperation on non-market economies through the Working
Group.
7.
Each side intends to suspend application of its countermeasures for a
period of 5 years, in the expectation that the other side will contribute to
establishing a level playing field and to addressing shared challenges from
non-market economies.
8.
The two sides will continue to confer on addressing outstanding support
measures.
As
part of the agreement, the United States and the European Union also released
an annex on cooperation on non-market economies. To more effectively address
the challenge posed by non-market economies, the parties will explore concrete
ways to intensify their cooperation in these areas:
a.
Information sharing. The
two sides will share information regarding cybersecurity concerns, the
priorities described below, and other areas relevant to non-market practices in
the large civil aircraft sector.
b.
Inward investments. The two sides will coordinate
and explore common approaches and enhanced cooperation regarding the screening
of inward investments in the large civil aircraft sector, including those whose
financing is supported by a non-market economy. Such inward investments
can lead to the appropriation of critical technologies relevant to the sector
by a non-market economy or a producer located in the territory of a non-market
economy.
c. Outward
investments. The
two sides will coordinate and explore common approaches and enhanced
cooperation regarding the screening of new outward investments in joint
ventures and production facilities in non-market economies to ensure that such
activities are not influenced by non-market forces, including conditioning the
in-country purchases on the location of production facilities or other actions,
that lead to the transfer of technology or jobs to the detriment of
market-oriented actors.
d. Joint
analysis of non-market practices. Some economies do not report transparently all
domestic subsidies and provide extensive support to their large civil aircraft
sector through subsidized equity investment, state lending, and state-directed
purchases. The two sides will share information about such subsidies, and
identify points where joint work is needed to clarify the extent of state
support, with the goal of establishing the basis for joint or parallel action
in the future. Some economies also do not permit their airlines to make
purchases in line with commercial considerations. The two sides will
develop information and consider joint action to ensure purchases reflect those
that private, market-oriented operators would undertake.
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