1992 Civil Aircraft Agreement

4.2. As of the entry into force of this agreement, direct state assistance promised by a contracting party for the development of a new large aircraft or derivatives programme cannot exceed: October 2004 – Washington presents a case of questioning European loans to help Airbus develop aircraft and terminates a 1992 civil aircraft agreement that includes state support for the two major aircraft manufacturers. Brief information on the Multilateral Civil Aircraft Trade Agreement Links to the Civil Aircraft Section of the WTO Guide On the Basis of the WTO. On 6 October 2004, the United States exercised its right to denounce the agreement between the United States and the EU on large civilian aircraft by sending a diplomatic note to the Council of Ministers of the European Union. At the same time, the United States has filed a request for WTO consultation with the European Communities, France, Germany, Spain and the United Kingdom on what the US Trade Representative, Robert Zoellick, has described as unfair subsidies to Airbus aircraft. The European Union has filed a counter-action with the WTO, claiming that Boeing has received illegal indirect subsidies. The European Commission also claimed that the unilateral denunciation of the 1992 agreement by the United States was invalid, since the agreement stipulates that the United States must give one year or provide evidence that the EU has violated the terms of the agreement. The United States disagrees with the EU`s interpretation. (a) 20% of the total payments calculated under Article 4.2 are due on the basis of the supply of a certain number of aircraft, or 40% of planned deliveries; In recent months, the United States has asked the European Commission to negotiate a new agreement to replace the United States and the EU in 1992. Agreement on large civil aircraft.

The agreement limits some state aid, including limiting the development costs of a new aircraft to one-third. (a) 3% of the annual turnover of the civil aviation industry of the party concerned for the products covered by this agreement; or, as of the entry into force of this agreement, the parties do not grant direct state assistance to what has already been firmly promised for the production of large civilian aircraft. This prohibition applies to both existing and future programs. In addition, Airbus` market share increased significantly over the life of the agreement. Their market share had already increased from 16% in 1988 to 30% in 1990 before the agreement was signed; It reached 50% in 1999.