Airbus has announced it has agreed to make changes to the A350 jet’s repayable launch aid from France and Spain in order to resolve a 16-year trade dispute and remove justification for U.S. tariffs.
The European planemaker said on Friday that the launch investment will be amended to what the World Trade Organization considers appropriate in terms of interest rates and risk-assessment benchmarks.
They say that after that Airbus will be in compliance with all WTO rulings.
Last year the US was given the green light to impose duties on $7.5 billion of European goods in retaliation over unlawful support for Airbus planes.
The WTO is due to rule on a similar case to determine damages the European Union can seek over market-distorting help for US firm Boeing.
Airbus said: "Airbus has agreed with the governments of France and Spain to make amendments to the A350 Repayable Launch Investment (RLI) contracts.
"After 16 years of litigation at the World Trade Organisation (WTO), this is the final step to stop the long-standing dispute and removes any justification for U.S. tariffs.
"The tariffs imposed by the United States Trade Representative (USTR) are currently harming all targeted industry sectors, including US airlines, and are adding to a very difficult environment as a consequence of the Covid-19 crisis.
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"This is why Airbus has decided to make a final step to remove the last contentious point and amend the French and Spanish contracts to what the WTO considers the appropriate interest rate and risk assessment benchmarks.
"The WTO has already ruled that RLI is a valid instrument for governments to partner with industry by sharing investment risks. With this final move, Airbus considers itself in complete compliance with all WTO rulings."
Airbus CEO Guillaume Faury said: "We have fully complied with all the WTO requirements. These additional amendments to the A350 RLIs demonstrate that Airbus has left no stone unturned to find a way towards a solution.
“This is a clear signal of support to those who are suffering from the severe impact of the tariffs imposed by the USTR, especially at a time when industries are hard hit by the consequences of the COVID-19 crisis.”