Apr 15, 1991
EC FAILS TO MODIFY REFERENCE TERMS OF AIRBUS PANEL.
GENEVA, 11 APRIL (TWN) – The panel set up by the GATT Subsidies Committee, which oversees the Tokyo Round agreement on subsidies, to adjudicate the U.S.-EC dispute over the purported German subsidy on exchange rate guarantee for its producers of Airbus, will work according to the standard terms of reference. This was announced at a brief meeting of the Subsidies Committee Thursday. Miss Angelina Yang, who chairs the committee, announced that the U.S.-EC consultations to modify the terms of reference have failed and the panel would function on the basis of the standard terms of reference. The EC had initially argued that the dispute should be heard and adjudicated upon in terms of the Tokyo Round agreement on trade in civil aircraft which calls for "special factors"-relating to this industry to be taken into account in judging state support. But the U.S. insisted on the issue being dealt with in terms of the Subsidies Code, and got the panel reference. The EC thereupon sought to get the terms of the panel modified to reflect the Civil Aircraft code also. But the U.S. declined and the EC efforts for a meeting of the Civil Aircraft Code committee or a joint meeting of the Subsidies and Civil Aircraft code committees also failed. The EC, in regretting this situation, has reserved its rights on the findings of the panel since, in the EC view, the panel could only work on an inadequate and incomplete legal basis. There are a number of cases of rulings be panels in the Subsidies Committee but whose adoption has been blocked by one side or another. The EC caveat implies the same fate may overtake the Airbus panel if the ruling goes against the EC. The panel membership is yet to be agreed.