06/21/21

The US and EU Reach A Deal in the Boeing-Airbus Dispute

The US and EU recently announced that they have reached a deal related to the long running Boeing – Airbus dispute. According to the official White House Press release, the US and EU will suspend tariffs for five years and work together to challenge and counter China’s non-market practices. According to the release, “Today’s announcement that the US and European Union (EU) have reached an agreement in the Boeing-Airbus dispute and agreed to address shared challenges from China does just that. The US and EU will suspend tariffs for five years and work together to challenge and counter China’s non-market practices in this sector in specific ways that reflect our standards for fair competition. This includes collaboration on inward and outbound investment and tech transfer. Today’s agreement represents a model the US can build on for other challenges posed by China. The President routinely says that we are strongest when we work with our friends and allies — today’s announcement is a demonstration of that in action.”

Per the White House announcement, U.S. and E.U officials have agreed to the following measures:

• Suspend the tariffs related to this dispute for five years. This signals a mutual determination to embark on a fresh start in the relationship. The agreement also retains flexibility for the United States to reapply tariffs if we’re no longer competing on a level playing field.

• Establish a Working Group 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. The Trade Ministers leading the Working Group will consult at least yearly. The Working Group will meet on request or at least every 6months.

• Ensure that our workers and industries can compete on a level playing field. The U.S. and EU agreed to clear statements on acceptable support for large civil aircraft producers that affirm the outcomes of the disputes and the intention of the parties to ensure that our workers and industries can compete on a level playing field.

• Confront the threat we face from China’s ambitions to build a sector upon non-market practices, including:
> Meaningful cooperation on countering (1) investments in the EU and the United States by non-market actors, which can lead to the appropriation of technology; and (2) outward investments into China that are influenced by non-market forces.
> Identifying where joint work is needed to take parallel action against non-market practices.
> Sharing information regarding these and other areas to forge a common approach in the large civil aircraft sector.

Please contact your V. Alexander account team with any questions and follow us on our website www.valexander.com for updates on this and other topics.

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01/08/21

USTR Announces Additional Section 301 EU Tariffs Beginning January 12, 2021

In retaliation to recent action by the EU in the ongoing large civil aircraft (Boeing-Airbus) dispute in the World Trade Organization, the United States Trade Representative (USTR) has announced additional products are being added to the list of EU goods subject to Section 301 tariffs.

An additional 15% duty will be assessed on aircraft parts, and an additional 25% duty will be assessed on various other goods, including certain non-sparkling wines, cognac and other grape brandies from France and Germany.

These additional duties will become effective on or after 12:01 AM EST on January 12, 2021. A copy of the full notice listing all affected products can be found here.

The ongoing large civil aircraft dispute between the United States and the European shows no immediate signs of slowing and no exclusion process has yet been implemented by the USTR in connection with this dispute.

V. Alexander will continue to monitor this ongoing issue and provide updates when needed.

Please contact your V. Alexander account team with any questions and follow us on our website www.valexander.com for updates on this and other topics.

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