The Commission decided, on 31 May 2005, to countersue the United States at the WTO on the subsidies the US grants to its aircraft manufacturer Boeing.
"I am disappointed that the US has chosen this confrontation with Europe. America’s decision will, I fear, spark probably the biggest, most difficult and costly legal dispute in the WTO’s history. It will be hard fought on both sides and, I can assure you, Europe’s interests will be fully defended," said the EU Trade Commissioner Peter Mandelson in a press statement. "I regret this diversion of effort but Europe is ready," he added.
Commissioner Mandelson also said that the real reason behind the US decision is not that much the EU subsidies to Airbus, but the fact that "commercially, Airbus is a huge success" and that the Boeing "fears competition".
In a joint statement, the US Trade Representative Rob Portman and Peter Mandelson assured that they are determined not to let this dispute affect transatlantic co-operation on wider bilateral and multilateral trade issues. Both sides are convinced of their case and the illegality of each other's subsidies.
Pascal Lamy, a former EU Trade Commissioner, under whom the dispute over subsidies to Airbus and Boeing started, was recently appointed as head of the WTO. Some lawyers think that the US may argue that under a former European Commissioner the WTO may be biased.
