WT/DS316/39  
 
3 August  2018 
(18-4947) Page: 1/9 
  Original: English  
 
 
 
EUROPEAN COMMUNITIES  AND CERTAIN MEMBER S TATES – MEASURES  
AFFECTING TRADE IN L ARGE CIVIL AIRCRAFT  
RECOURSE TO ARTICLE 21.5 OF THE DSU BY T HE EUROPEAN UNION  
AND CERTAIN MEMBER S TATES  
REQUEST FOR THE ESTA BLISHMENT OF A PANEL  
The following communication, dated 31 July 2018 , from the delegation of the European Union  to 
the Chairperson of the Dispute Settlement Body, is circulated pursuant to Article 21.5 of the DSU.  
 
_______________  
 
 
1.  The European Union1 requests the establishment of a panel pursuant to Article 21.5 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes  ("DSU") and Article 
7.4 of the Agreement on Subsidies and Countervailing Measures ("SCM Agreem ent"), with 
standard terms of reference, as set out in Article 7 of the DSU, with respect to the issues identified 
below.  The European Union also refers to the "Agreed Procedures under Article 21 and 22 of the 
DSU and Article 7 of the SCM Agreement ", date d 12 January 20122  ("Sequencing Agreement "), 
which apply "for the exclusive purposes of this dispute ", and in particular paragraphs 1 and 2 
thereof, which govern the procedures for the Parties to request the establishment of a panel under 
Article 21.5 of the DSU in this dispute.   
2.  This request for establishment of a panel is made with respect to a "disagr eement ", under 
Article  21.5 of the DSU, "as to the existence or consistency with a covered agreement of measures 
taken to comply with the recommendations and rulings " of the Dispute Settlement Body ( "DSB") in 
EC and Certain member States – Measures Affecti ng Trade in Large Civil Aircraft (DS 316) ( "EC – 
Large Civil Aircraft "). 
3.  On 1 June 2011, the Dispute Settlement Body ( "DSB") adopted the Appellate Body report, and 
the Panel report as modified by the Appellate Body report, in EC – Large Civil Aircraft .  The DSB 's 
recommendations called upon the European Union to secure compliance with its WTO obligations in 
respect of member State financing ( "MSF") for the A300, A310, A320, A330/340, A330 -200, A340 -
500/600 and A380, or their adverse effects.  The recommenda tions and rulings also covered 
certain infrastructure measures, equity infusions and a number of regional development grants.  
4.  On 1 December 2011, the European Union informed the DSB of the steps taken to implement 
the DSB 's recommendations.3  A disagreemen t arose between the United States and the European 
Union regarding the sufficiency of the compliance steps communicated by the European Union to 
the DSB.  Following consultations, and at the request of the United States, on 13 April 2012, the 
DSB referred the parties ' disagreement to a compliance panel established under Article  21.5 of the 
DSU. 
5.  The compliance panel circulated its report on 22 September 2016.  The report of the 
compliance panel was appealed by both the parties, and the Appellate Body circula ted its report on 
15 May 2018.   
                                                
1 Unless the context otherwise requires, as a matter of WTO law, references in this document (and any 
subsequent document filed in this dispute) to the European Union include the "certain member States " (France, 
Germany, Spain and the United Kingdom) against  which the United States commenced this dispute.  
2 WT/DS316/21.  
3 WT/DS316/17.  WT/DS316/39  
 
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 6.  In the compliance proceedings, the panel report, as modified by the Appellate Body report, 
confirms that the European Union has achieved substantial compliance with much of the DSB 's 
recommendations and rulings.  However, t he compliance Panel report, as modified by the 
Appellate Body report, also found that the European Union had not yet fully complied with all of 
the DSB 's recommendations and rulings in respect of adverse effects arising from A380 MSF, and 
added a recommend ation in respect of A350XWB MSF.  
7.  Having reviewed the reports of the panel and the Appellate Body, the European Union notified 
the DSB on 17 May 2018 that the European Union has adopted a series of additional measures 
that achieve full compliance, consisten t with Article  7.8 of the SCM Agreement  ("Second 
Compliance Communication ").4  Specifically, the European Union informed the DSB that, with 
these measures, the European Union has (i)  withdrawn the remaining subsidies, and/or (ii)  taken 
appropriate steps to  remove their adverse effects.  These measures bring the European Union into 
full compliance with its WTO obligations.  These measures constitute the measures taken to 
comply that are the subject of this request for establishment of a panel.  
8.  The European U nion appends its Second Compliance Communication as Annex  A to this request 
for the establishment of a panel.  The Second Compliance Communication constitutes an integral 
part of this request for the establishment of a panel.  
9.    As required by Article 6.2 o f the DSU, the specific measures at issue are identified in items i -
xviii of the Second Compliance Communication.  The legal basis for this request is that, pursuant 
to Article  7.8 of the SCM Agreement , these measures have resulted in the European Union 
achieving full compliance, by (i)  withdrawing the remaining subsidies, and/or (ii)  taking 
appropriate steps to remove their adverse effects, as specifically set out in the Second Compliance 
Communication.  
10.  The United States has expressed the view that the European Union has not yet fully complied 
with the recommendations and rulings of the DSB.5  Moreover, the United States has requested 
the re -initiation of arbitration proceedings under Article  7.10 of the SCM Agreement and 
Article  22.6 of the DSU, indicat ing that it disagrees that the items addressed in the Second 
Compliance Communication procure full compliance with the European Union 's WTO obligations.6  
Together, these facts have given rise to a "disagreement as to the existence or consistency with a 
covered agreement of measures taken to comply " with the recommendations and rulings of the 
DSB, within the meaning of Article  21.5 of the DSU.  
11.  On 29 May 2018, the European Union requested consultations with the United States on this 
disagreement, under the t erms of the Sequencing Agreement.  Consultations were held on 27 June 
2018.  Regrettably, they did not result in resolution of the disagreement.  
12.  Accordingly, the European Union requests that the DSB establish a panel under Article 21.5 of 
the DSU and, to t he extent applicable, Article 7.4 of the SCM Agreement , with the standard terms 
of reference stipulated in Article 7 of the DSU.  
13.  The European Union notes that under paragraph 2 of the Sequencing Agreement, which 
applies "for the exclusive purposes of this  dispute ", the Parties agreed to accept the establishment 
of a Panel at the first DSB meeting at which this request appears on the agenda.  
*     *     * 
                                                
4 WT/DS316/34  
5 Statement by the United States at the DSB meeting on 28 May 2018.  
6 Communication from the United States to the Chairperson of the Arbitration Panel dated 13 Jul y 2018.  WT/DS316/39  
 
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  Annex A  
Second Compliance Communication  
European Communities and Certain member States – 
Measures Affecting Trade in Large Civil Aircraft  
1. The European Union1 refers to the recommendations and rulings of the WTO Dispute 
Settlement Body ( "DSB") with respect to the dispute European Communities and Certain member 
States – Measures Affecting Trade in Large Civil Aircraft  (WT/DS316), as well as the compliance 
panel report (WT/DS316/RW), as modified by the recent Appellate Body report 
(WT/DS316/AB/RW),2 in that same dispute.  
2. The European Union would like to inform the DSB that it has taken appropriate steps to 
bring its mea sures fully into conformity with its WTO obligations, and to comply with the DSB 's 
recommendations and rulings.  By taking appropriate steps to bring the measures at issue into 
conformity with the European Union 's WTO obligations, as required by Article  7.8 of the Agreement 
on Subsidies and Countervailing Measures  ("SCM Agreement ") and Article  19.1 of the 
Understanding on Rules and Procedures Governing the Settlement of Disputes  ("DSU"), the 
European Union has ensured full implementation of the DSB 's recomm endations and rulings, and 
has consequently eliminated any nullification or impairment attributable to non -compliance with 
those recommendations and rulings.  
3. In this communication to the DSB, the European Union uses the term "adverse effects " in 
the same s ense as that term is used in Articles  5, 7.8, 7.9 and 7.10 of the SCM Agreement .  
Consistent with those provisions, achieving compliance by withdrawing the subsidy or taking 
appropriate steps to remove the adverse effects also achieves the elimination of n ullification or 
impairment within the meaning of Article  5(b) of the SCM Agreement  and Articles  22.4, 22.7 and 
22.8 of the DSU.  
4. The relationship, in this dispute, between achieving compliance by withdrawing the subsidy 
or taking appropriate steps to remove  the adverse effects, on the one hand, and the elimination of 
nullification and impairment, on the other, is also underscored by:  
(1) the specific and unique character of proceedings under Part III of the SCM Agreement ; 
(2) the specific terms of the Recourse to Ar ticle 7.9 of the SCM Agreement  and Article  22.2 of 
the DSU by the United States,3 and the Recourse to Article  22.6 of the DSU by the 
European Union;4 and, 
(3) the Agreed Procedures under Article  21 and 22 of the DSU and Article  7 of the SCM 
Agreement that the European Union and the United States adopted for the purposes of this 
dispute on 12 January 2012.5 
5. Given that this communication concerns, in part, the withdrawal of subsidies and/or the 
removal of adverse effects, it is relevant for "the original panel " within the meaning of Article  21.5 
                                                
1 Where the context so requires, as a matter of WTO law, references in this document to the European 
Union include the "certain member States " (France, Germany, Spain and the United Kingdom) against which 
the United States commenced this dispute.  
2 References in this communication to the compliance panel report, as modified by the Appellate Body 
Report, also encompass the compliance Appellate Body Report itself.  
3 WT/DS316/18 ( "[T]he United States requests authorization from the Dispute Settlement B ody (‘DSB’) 
to take countermeasures with respect to the European Union (‘EU’) at an annual level commensurate with the 
degree and nature of the adverse effects caused to the interests of the United States  by the failure of the EU 
and certain member States to withdraw subsidies or remove their adverse effects  in compliance with the 
recommendations and rulings of the DSB. This amount corresponds to the annual value of lost sales, of imports 
of US large civil aircraft displaced from the EU market, and of expor ts of US large civil aircraft displaced from 
third country markets. The amount will be updated annually  using the most recent publicly available data ".) 
(emphasis added).  
4 WT/DS316/20.  
5 WT/DS316/21.  WT/DS316/39  
 
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  of the DSU, in the event that it is called upon, for a second time, to adjudicate a "disagreement ", 
within the meaning of Article  21.5. 
6. At the same time, given that this document also concerns the elimination of nullificat ion and 
impairment, it is equally relevant for "the original panel " within the meaning of Article  22.6 of the 
DSU, in the event of arbitration panel proceedings.  
I. Background  
7. The European Union recalls that the recommendations and rulings of the DSB, adop ted in 
June 2011, cover a number of subsidies in the form of member State financing ( "MSF") from 
France, Germany, Spain and the United Kingdom ( "UK") for the development of various families of 
Airbus large civil aircraft ( "LCA").  In particular, the DSB 's recommendations and rulings called 
upon the European Union to secure compliance with its WTO obligations in respect of MSF for the 
A300, A310, A320, A330/340, A330 -200, A340 -500/600 and A380.  The recommendations and 
rulings also covered certain infrastruc ture measures, equity infusions and a number of regional 
development grants.  
8. On 1 December 2011, the European Union informed the DSB of the steps taken to 
implement the DSB 's recommendations and rulings.6  A disagreement arose between the United 
States and  the European Union regarding the sufficiency of the compliance steps communicated by 
the European Union to the DSB.  Following consultations, and at the request of the United States, 
on 13 April 2012, the DSB referred the parties ' disagreement to a compli ance panel established 
under Article  21.5 of the DSU.  
9. The compliance panel circulated its report on 22 September 2016.  The report of the 
compliance panel was appealed by both parties, and the Appellate Body circulated its report on 15 
May 2018.  
10. In the com pliance proceedings, the panel report, as modified by the Appellate Body report, 
confirms that the European Union has achieved substantial compliance with much of the DSB 's 
recommendations and rulings.7  However, the panel report, as modified by the Appell ate Body 
report, also found that the European Union had not yet fully complied with all of the DSB 's 
recommendations and rulings in respect of adverse effects arising from A380 MSF, and added 
recommendations and rulings in respect of A350XWB MSF (with resp ect to which the European 
Union has yet to receive a reasonable period of time in which to comply, within the meaning of 
Article  21.3 of the DSU).  
11. In considering appropriate steps to bring these remaining and additional measures into 
conformity with its WT O obligations, the European Union took note of all elements of the DSB 's 
recommendations and rulings, and the Appellate Body 's guidance on the content and nature of the 
applicable compliance obligation under Article  7.8 of the SCM Agreement .  In particular, the 
European Union notes the Appellate Body 's confirmation that a Member found to have acted 
inconsistently with Articles  5 and 6.3 of the SCM Agreement  can achieve compliance under 
Article  7.8 by either (i)  withdrawing the subsidy, or (ii)  taking appropriate steps to remove the 
adverse effects of the subsidy.  The European Union also notes the Appellate Body 's findings on 
the meaning of the term "withdraw " in Article  7.8.  In relation to the removal of adverse effects, 
the European Union has al so given close consideration to the Appellate Body 's guidance on the 
delineation of product markets, the requirements of a proper causation assessment, and the 
preconditions for a finding of displacement or of impedance.  The European Union has also closel y 
monitored and assessed LCA product and market developments in the months and years following 
the period covered by the panel 's review.  
                                                
6 WT/DS316/17.  
7 Appellate Body Report, EC – Large Civi l Aircraft (Article 21.5 – US), paras. 5.1 -5.25, 5.351 -5.383, 
5.384 -5.404, 5.710, 5.716, 5.719 -5.722, 5.731, 5.732 -5.737, 5.742, 6.2, 6.11, 6.12 -6.13, 6.19, 6.26 -6.29, 
6.32-6.35, 6.39 -6.40. WT/DS316/39  
 
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  12. Taking all of these factors into account, the European Union has taken appropriate steps to 
address the remaining and a dditional elements of the DSB 's recommendations and rulings, either 
through the withdrawal of subsidies or the removal of the adverse effects.8 
13. In Section 0, the European Union lists the measures taken to comply with the DSB 's 
recommendations and rulings.  In Section 0, the European Union explains that these measures 
achieve the withdrawal of the subsidies at issue, constitute appropriate steps to remove their 
adverse effects, or both, and achieve the elimination of nullification and impa irment.  
14. By taking appropriate steps to bring the measures at issue into conformity with the 
European Union 's WTO obligations, as required by Article  7.8 of the SCM Agreement  and 
Article  19.1 of the DSU, the European Union has ensured full implementation of  the DSB 's 
recommendations and rulings, and has consequently eliminated any nullification or impairment 
attributable to non -compliance with those recommendations and rulings.  
II. List of Measures Taken to Comply  
15. The European Union sets out below a list of measures taken to comply with the 
recommendations and rulings of the DSB in the present dispute.  
A. Measures that Achieve Withdrawal of the Subsidies under Articles  7.8, 1 and 2 of 
the SCM Agreement , and Contribute to Removal of their Adverse Effects, under 
Articles  7.8, 5 and 6.3 of the SCM Agreement9 
i. A 2018 amendment to the French A380 MSF Agreement;  
ii. A 2018 amendment to the German A380 MSF Agreement;  
iii. A 2018 amendment to the Spanish A380 MSF Agreeme nt; 
iv. A 2018 amendment to the UK A380 MSF Agreement;  
v. A 2018 amendment to the German A350XWB MSF Agreement;  
vi. Full repayment of the UK A350XWB MSF in 2018;  
vii. Withdrawal through amortisation or otherwise of the "benefit " conferred by the 
French, German, Spanish an d UK A380 MSF Agreements; and,  
viii. Withdrawal through amortisation or otherwise of the "benefit " conferred by the 
French, German, Spanish and UK A350XWB MSF Agreements.  
B. Measures that Constitute Appropriate Steps to Remove Adverse Effects, under 
Articles  7.8, 5  and 6.3 of the SCM Agreement  
ix. Withdrawal, through amortisation or otherwise, of the "benefit " conferred by the 
French, German, Spanish and UK A380 MSF Agreements;  
x. Non-subsidised investments in A380 family aircraft;  
xi. Reduced draw down of the loan amounts und er the French A380 MSF Agreement;  
xii. Cancellation or completion of A380 deliveries corresponding to the Transaero 2012 
and Emirates 2013 orders, and delivery of any outstanding A380 aircraft to certain 
                                                
8 The European Union has done so "immediately " to the extent "practicable ". However, with respect to 
the additional elements of the DSB's recommendations and rulings, this is without prejudice to the European 
Union's right to a reasonable period of time, within the meaning of Article 21.3 of the DSU.  
9 As noted at paragr aph 16, below, through the withdrawal of subsidies, these measures also contribute 
to the removal of adverse effects.   WT/DS316/39  
 
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  country markets covered by the finding of impedance in th e Very Large Aircraft 
("VLA") market;  
xiii. Attenuation, through the passage of time and events that occurred during that time, 
of the causal link between A380 MSF and the launch of the A380 and the A350XWB, 
as and when they were launched;  
xiv. Withdrawal, through am ortisation or otherwise, of the "benefit " conferred by the 
French, German, Spanish and UK A350XWB MSF Agreements;  
xv. Non-subsidised investments in A350XWB family aircraft;  
xvi. Reduced draw down of the loan amounts under the French and UK A350XWB MSF 
Agreements;  
xvii.  Attenuation, through the passage of time and events that occurred during that time, 
of the causal link between A350XWB MSF and the launch of the A350XWB as and 
when it was launched; and,  
xviii.  Completion or conversion to other aircraft of A350XWB deliveries corre sponding to the 
Cathay Pacific 2012, Singapore Airlines 2013 and United Airlines 2013 orders of the 
A350XWB.  
III. The Measures Taken to Comply Achieve Full Compliance within the Framework of 
Article  7.8 of the SCM Agreement  
16. As noted above, in its report in the compliance proceedings, the Appellate Body clarified that 
a Member found to have provided subsidies that have resulted in adverse effects, under Articles  5 
and 6.3 of the SCM Agreement , can come into compliance by eithe r withdrawing the subsidy, or by 
taking appropriate steps to remove the adverse effects of those subsidies.10  In part  A, below, the 
European Unio n explains that measures i-viii listed above achieve the withdrawal of the subsidy 
from A380 MSF and A350XWB MSF.  Through the withdrawal of the subsidy, these measures also 
contribute to the removal of adverse effects, and  to the elimination of nullification and impairment.  
For any subsidies that have not been withdrawn, the European Union explains in part B, belo w, 
that measures ix-xviii listed above constitute appropriate steps to remove their adverse effects, 
which would also contribute to the elimination of nullification and impairment.  
A. Withdrawal of the Subsidies  
17. The Appellate Body clarified that a Member found to have provided subsidies that have 
resulted in adverse effects, under Articles  5 and 6.3 of the SCM Agreement , can achieve full 
compliance by withdrawing the subsidy.11  The European Union notes that measures achieving the 
full or partial withdrawal of subsidies at issue would also contribut e to the removal of adverse 
effects, and to the elimination of nullification and impairment.  
18. The European Union has procured full withdrawal of the subsidy from French, German, 
Spanish and UK A380 MSF, and of the subsidy from German and UK A350XWB MSF, and  at least 
partial withdrawal of the subsidies from French and Spanish A350XWB MSF.  
19. A380 MSF:  France, Germany, Spain and the UK have agreed amendments with Airbus to 
each of the A380 MSF Agreements (Measures i-iv, listed above).  In each case, the parties have 
agreed amendments to achieve pr ospective consistency with a contemporaneous market 
benchmark.  Therefore, the European Union has procured withdrawal of the subsidies conferred by 
each of the A380 MSF loans.  
20. In any event, the benefit from the French, German, Spanish and UK A380 MSF subsi dies has 
been withdrawn through amortisation or otherwise, achieving the withdrawal of these subsidies 
(Measure vii, listed above).  
                                                
10 Appellate Body Report, EC – Large Civil Ai rcraft (Article 21.5 – US), para. 5.383.  
11 Appellate Body Report, EC – Large Civil Aircraft (Article 21.5 – US), para. 5.383.  WT/DS316/39  
 
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  21. GERMAN A350XWB MSF:  Germany, through Kreditanstalt für Wiederaufbau ( "KfW"), and 
Airbus have concluded an amendment to the German A350XWB MSF agreement (Measure v, 
above).  The amendment achieves consistency with a contemporaneous market benchmark, such 
that the subsidy conferred by German A350XWB MSF is withdrawn.  Additionally, the European 
Union also notes that the benefit conferred by the German A350XWB MSF loa n has now 
substantially amortised (Measure viii, listed above).  
22. UK A350XWB MSF :  Airbus has repaid in full amounts outstanding under the UK A350XWB  
MSF Agreement (Measure vi, above), such that the subsidy conferred by UK A350XWB MSF is 
withdrawn.  Additionally, the European Union also notes that the benefit conferred by the UK 
A350XWB MSF loan has now substantial ly amortised (Measure viii, listed above).  
23. FRENCH AND SPANISH A350XWB MSF :  The benefit from the French and Spanish 
A350XWB MSF has now substantiall y been withdrawn through amortisation or otherwise (Measure 
viii, listed above).  
B. Appropriate steps to remove the adverse effects  
24. The Appellate Body also clarified that a Member found to have conferred subsidies that have 
resulted in adverse effects, under Articles  5 and 6.3 of the SCM Agreement , can come into 
compliance by taking appropriate steps to remove the adverse effects.12 
25. In the present dispute , the United States advanced its adverse effects claim based on an 
allegation that the provision of the subsidies at issue caused the launch of several families of 
Airbus aircraft.  The June 2011 recommendations and rulings adop ted by the DSB reflected the se 
arguments, and were based on the finding that the subsidies at issue were a genuine and 
substantial cause of the sale and delivery of certain Airbus aircraft, and consequently certain 
adverse effects to the United States found to have resulted from thos e sales and deliveries.  
26. In the compliance proceedings in the present dispute, the panel report, as modified by the 
Appellate Body, found that the MSF subsidies were a genuine and substantial cause of certain sales 
and deliveries of A380 and A350XWB aircraf t that were held to trigger adverse effects.  For the 
A380, these adverse effects were attributed to the "direct effects " of A380 MSF alone.  For the 
A350XWB, these adverse effects were attributed to the "direct effects " of A350XWB MSF, and the 
"indirect effects " of A380 MSF.  
27. As the European Union has already discussed above, the European Union has now 
withdrawn the A380 MSF subsidies, the German and UK A350XWB MSF subsidies,13 and has, 
therefore, achieved full compliance in respect of these subsidies (Meas ures i-vii, above).  
Therefore, the ques tion whether these withdrawn subsidies are presently a cause of adverse 
effects is irrelevant as a matter of law.  
28. Nonetheless, the European Union has also taken appropriate steps to remove any adverse 
effects attributable to any or all of the subsidies in respect of which the European Union incurred 
compliance obligations in light of the compliance panel report, as modified by the Appellate Body 
report ( i.e., A380 MSF and A350XWB MSF).  Currently, neither A380 MSF nor A350XWB MSF is a 
genuine and substantia l cause of any adverse effects.  Below, the European Union explains this 
conclusion with reference to the A380 and the A350XWB.  
29. A380 :  As discussed above, the A380 MSF subsidies have now been withdrawn through 
amendments that prospectively align the A380 M SF loans with the relevant contemporary market 
benchmark (Measures i-iv).  Without prejudice to that observation, the European Union considers 
that, in any event, any benefit from A380 MSF has been withdrawn through amortisation or 
otherwise (Measure vii, above).  These demonstrate that the subsidies can no longer be 
considered a genuine and substantial cause of sales or deliveries of A380 aircraft, or any 
associated adverse effects.  
                                                
12 Appellate Body Report, EC – Large Civil Aircraft (Article 21.5 – US), para. 5.383.  
13 As discussed above, the European Union has also achieved at least partial withdrawal of the French 
and Spanish A350XWB MSF subsidies.  WT/DS316/39  
 
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  30. The European Union also notes that Airbus did not draw down the full amount of the French 
A380 MSF loan (Measure xi, above).  This shows, once agai n, that the subsidy can no longer be 
considered a genuine and substantial cause of sales or deliveries of A380 aircraft, or any 
associated adverse effects.  
31. Airbus has also undertaken significant non -subsidised investments in the A380, and in A380 -
related c ontinuous support and development (Measure x, listed above).  Currently, neither A380 
MSF nor any other subsidy at issue is a genuine and substantia l cause of sales or deliveries of 
A380 aircraft, or any associated adverse effects.  
32. The Transaero 2012 order for A380 aircraft, which formed the basis of lost sales findings 
confirmed by the Appellate Body, has been cancelled; many of the deliveries corres ponding to the 
2013 order by Emirates have already been made (Measure xii, listed above).  These measures 
again constitute appropriate steps for th e removal of adverse effects in the form of lost sales.  
33. The passage of time has also attenuated the causal link between the A380 MSF subsidies 
and the launch of the A380 as and when it was launched, such that A380 MSF is no longer a cause 
of sales or deliv eries of A380 aircraft or any associated adverse effects (Measure xiii, listed above).  
34. A350XWB :  As the European Union discussed above, A380 MSF, wh ich the compliance 
panel report, as modified by the Appellate Body, considered to be a cause of the launch of the 
A350XWB as and when it was launched, and of resulting sales or deliveries of the A350XWB 
aircraft and associated adverse effects, has now been  withdrawn, either through the prospective 
alignment of the A350XWB MSF loans with the relevant contemporary market benchmark, or 
otherwise (including by amortisation) (Measures i-iv and vii, above).  
35. As the European Union discussed above, German and UK MSF subsidies for the A350XWB 
have now also been withdrawn (Measures v and vi, listed above).  As such, they can no longer be 
considered a cause of the launch of the A 350XWB as and when it was launched, and of resulting 
sales or deliveries of A350XWB aircraft or any associated adverse effects.  
36. As discussed above, the European Union has also achieved at least partial withdrawal of the 
French and Spanish A350XWB MSF subsi dies (Measure viii, listed above).  
37. While appropriate steps for the removal of the adverse effects are not necessary in respect 
of subsidies which ha ve been withdrawn, the European Union has, in any event, taken such steps 
in relation to all of the A350XWB MSF subsidies.  
38. The European Union notes that Airbus did not draw down the full amount under the French 
and UK A350XWB MSF Agreements (Measure xvi, above).  This demonstrates that there is very 
little, if any, benefit remaining from the A350XWB MSF subsidies, such that the A350XWB MSF 
subsidies can no longer be considered a cause of the launch of the A350XWB as and when it was 
launched, and of resulting sales or deliveries of A350XWB aircraft or any associated adverse 
effects.  
39. Additionally, any benefit from the A350XWB MSF subsidies has now substantially amortised 
(Measure xiv, above).  Once again, this demonstrates that the A350XWB MSF subsidies can no 
longer be considered a cause of the launch of the A350XWB as and when it was launched, and of 
resulting sales or deliveries of A350XWB aircraft or any associated adverse effects.  
40. The passage of time has also attenuated the causal link between the A380 and A350XWB 
MSF subsidies and the launch of the A350XWB as and when it was launched, such that A380 MSF 
and A350XWB MSF can no longer be considered a cause of the launch of the A350XWB as and 
when it was launched, and of result ing sales or deliveries of A350XWB aircraft or any associated 
adverse effects (Measures xiii and xvii, listed above).  
41. Additionally, Airbus has undertaken significant non -subsidised investments in the A350XWB, 
and in A350XWB -related continuous support and development (Measure xv, above).  Neither 
A350XWB MSF nor any other subsidy at issue is currently a genuine and substantial cause of sales 
or deliveries of the A350XWB or any associated  adverse effects.  WT/DS316/39  
 
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  42. Moreover, the Cathay Pacific 2012, Singapore Airlines 2013 and United Airlines 2013 orders, 
which formed the basis of lost sales findings confirmed by the Appellate Body, have been delivered 
or converted to other aircraft (Measure xviii, above).  These measures again constitute appropriate 
steps for the removal of adverse effects in the form of lost sales.  
IV. Conclusion  
43. In light of the above, and in light of the "Agreed Procedures under Article  21 and 22 of the 
DSU and Article  7 of the SCM Agreement " adopted by the European Union and the United States 
on 12 January 2012 for purposes of this dispute, the European Union notifies the DS B that it has 
achieved full compliance with the recommendations and rulings in the present dispute.14 
 
 
__________  
                                                
14 As noted above, this notification is without prejudice to the European Union's right to a reasonable 
period of time, within the meaning of Article 21.3 of the DSU.