U.S. To Push WTO Complaint Against Airbus

Also talking with EU about common concerns, including Chinese intellectual property protection.

GENEVA (AP) - The United States will push forward with its World Trade Organization complaint against what it says are illegal forms of government support by European governments for plane manufacturer Airbus, a senior U.S. trade official said Tuesday.

''Right now, we are proceeding on the litigation path,'' John Veroneau, the deputy U.S. trade representative, told reporters at the WTO's headquarters in Geneva. ''At this point, I expect that path to continue.''

Veroneau said he met last week with European Union officials to discuss suspended global trade talks and common concerns such as Chinese intellectual property protection.

He said the two trade powers also discussed their long-standing dispute over subsidies to rival airplane makers Airbus and Boeing Co.

The U.S. claims that Airbus has benefited from billions in illegal launch aid, development financing, contributions and debt relief from the 25-nation EU and its member states. Brussels accuses Washington of providing vast amounts of hidden support to Boeing through military contracts.

Four WTO investigations have been authorized, but procedural wrangling on both sides has held up much of the work by the Geneva-based commerce body.

''In the end, we will see what the panels produce,'' Veroneau said. ''That said, we have made clear before and I made clear again last week that we remain open to a negotiated settlement.''

The complex dispute - which EU trade chief Peter Mandelson has said could take ''years to resolve,'' but would likely result in a legal stalemate - started when Washington filed its WTO complaint against Airbus aid in 2004, arguing that European government subsidies distorted market prices and allowed the company to overtake Boeing as the biggest civil aircraft seller.

The U.S. moved its case forward in October, asking the WTO's investigative panel to resume work after a six-month freeze initiated by the world's two biggest commercial powers. Washington made its first submissions to the panel last month.

Brussels is expected to respond by early February. In the meantime, the bloc has pushed forward with its own allegations of U.S. support for Chicago-based Boeing. First submissions to arbitrators are expected early next year.

Airbus set an industry record in 2005 with 1,111 orders to Boeing's 1,002, but its market share by value fell to 45 percent from 54 percent in 2004, as its widebody airliners lost ground to the rival Boeing 777 and upcoming 787. That share is set to fall to about 37 percent this year, based on the catalog value of the 635 orders it won in January-November, to Boeing's 823.

Airbus, poised to fall behind Boeing on orders for the first time in six years, has suffered from a series of production setbacks and leadership crises. Since new delays to the 555-seater A380 superjumbo came to light in June, the civil airliner and its parent company, European Aeronautic Defence and Space Co., have lost three chief executives.

''Airbus is going through a lot of changes right now,'' Veroneau said. ''We are respectful of matters that they are considering internally. If the situation avails itself to explore possible ways forward to negotiate something, then we are open to doing that.''