Proposed US Tariff Retaliations in the US-EU Aircraft Dispute

The United States Trade Representative (USTR) announced on 23 June that it is proposing to “carousel” its retaliation list in the US-EU large aircraft dispute. This US action will potentially remove products currently on the list and modify the scope to include new products, an expanded number of countries, and a possible increase in retaliatory tariffs applied[1].

These proposed modifications are the latest move in a series of actions in the US-EU large aircraft dispute. On 13 July 2018, the WTO ruled in favor of the United States and approved retaliatory measures against the EU due to subsidies provided for the Airbus company and in EU domestic commercial aircraft industry, which were deemed inconsistent with international trade obligations[2]. Following an initial investigation which began on 12 April 2019, a finalized list of products from EU countries subject to additional tariffs came into effect on 18 October 2019 [3]. On 14 February 2020, the USTR announced a further revised list, including an additional tariff on aircrafts and parts from 10% to 15%, as well as other modifications.

The USTR’s recent 23 June 2020 announcement classified relevant products as falling under one of three annexes.

• Annex I includes products included in the initial round of retaliation.
• Annex II includes products in which tariffs of up to 100% on various member states were proposed but were never implemented. These tariffs are being considered again in this review of retaliatory action.
• Annex III includes new products in which tariffs of up to 100% are being considered from Spain, France, Germany, and the United Kingdom including a variety of products from chocolate to vodka.

The Federal Register notice provides a comprehensive description of the products listed in each of these three categories.

On 26 June, the USTR opened an online portal for comment submission on revising previous retaliatory tariffs and implementing additional duties. The comment period will be open for one month, ending on Sunday, 26 July 2020. Comments must be submitted via USTR’s portal using their template.

Are your products from the EU member states targeted on the proposed lists? Visit the US Harmonized Tariff Schedule Search Engine to find the tariff code for your products.

Contact us if you would like further information on the potential impacts of these retaliatory tariffs or assistance in submitting comments to USTR.

Colleen Cosey
ccosey@trademoves.net

​Chinyen Cheng
ccheng@trademoves.net

[1] Federal Register / Vol. 85, No. 124 / Friday, June 26, 2020 / Notices
[2] Federal Register / Vol. 84, No. 71 / Friday, April 12, 2019 / Notices
[3] Federal Register / Vol. 84, No. 196 / Wednesday, October 9, 2019 / Notices