EU gets approval to slap $4bn worth of tariffs on US imports in Boeing dispute

Watch: EU wins right to hit US with tariffs

The World Trade Organisation in Geneva on Tuesday gave the European Union its approval to impose punitive tariffs to the tune of almost $4bn (£3bn, €3.4bn) on US goods, over the US’s subsidies for the aircraft manufacturer Boeing (BA).

The fight between the EU and US over their respective subsidies for Airbus (AIR.PA) and Boeing has been raging for around 16 years, with both sides accusing the other of illegal support of their aircraft manufacturers. The EU had requested $8.58bn in damages.

In 2019, the WTO approved US sanctions on EU goods and services to the value of $7.5bn, after it ruled that the bloc’s aid to Airbus was illegal under international trade rules. This was the highest tariff amount ever approved by the WTO.

EU trade commissioner Valdis Dombrovskis said he hoped the decision will prompt both sides to align on new subsidy rules for the airline industry.

READ MORE: IMF: COVID-19 'will erase 30 years of progress fighting poverty'

“The EU will immediately re-engage with the US in a positive and constructive manner to decide on next steps,” Dombrovskis said. “Our strong preference is for a negotiated settlement. Otherwise, we will be forced to defend our interests and respond in a proportionate way.”

The European Commission has already made a list of US imports that it could target with tariffs, including games consoles, foods, including ketchup, wine and spirits, and also planes and tractors.

Reuters reports that while the bloc could enact the sanctions from after a WTO meeting on 26 October, analysts do not expect it to slap on the tariffs until after the US election.

Watch: Why tax rises may be inevitable in Britain