B4-1062/95

Resolution on the bilateral negotiations between the European Union and the United States on civil aircraft

The European Parliament,

A. whereas the 1979 GATT Tokyo Round Agreement on Civil Aircraft successfully eliminated most traditional barriers to trade in civil aircraft and aeronautical products,

B. whereas the 1979 Agreement recognized the special position of the aerospace industry but was not specific about allowable levels of direct and indirect government support,

C. whereas in 1992 the European Union and the United States concluded a bilateral agreement on government support in the civil aircraft industry,

D. whereas in this agreement, the European Union and the United States agreed, on a bilateral basis, ceilings for both direct and indirect government support for large civil aircraft with more than 1OO seats,

E. whereas, as part of the Uruguay Round, proposals were made for a new GATT Agreement on Trade in Civil Aircraft, to apply to all aeronautical products (not just large civil aircraft) and to all WTO members (not just the EU and US),

F. whereas these negotiations were not successfully completed during the Uruguay Round and negotiators were given a further 12 months to reach agreement; whereas EU-US talks have made no further progress either,

G. whereas the Union has exclusive powers as regards the common commercial policy and government aid,

H. whereas recent fluctuations in the exchange rate between the European currencies and the US dollar have substantially affected the competitiveness of the European aircraft industry,

The European Parliament,

1. Recognises the importance of maintaining a healthy European industry in civil aerospace manufacturing for jobs and European industrial competitiveness;

2. Recognises that large amounts of US Government spending on defence are giving clear benefits to the US civil aerospace industry, advantages which are not available to the EU industry;

3. Regrets that it has so far proved impossible to conclude an equitable multilateral agreement on binding rules on government support in the civil aircraft industry;

4. Is concerned to note that the bilateral agreement between the Union and the United States is still not operating smoothly, because of the lack of adequate information from the US Administration on direct and indirect support to the US civil airframe industry;

5. Calls on the United States to respect the letter and the spirit of the bilateral agreement which makes the exchange of information obligatory;

6. Points out that further work needs to be done in improving the level of transparency in indirect support to the US aerospace industry and in accounting for benefits to civil applications from the defence business in the USA and that a methodology for identifying direct as well as indirect benefits which flow from this support through to the aircraft industry needs to be agreed;

7. Recognises that there is a need to put in place effective mechanisms for controlling government support which are generally applicable without giving a competitive advantage to either side;

8. Stresses that a trade dispute in this sector is in the interests of neither Europe nor the United States;

9. Appeals to all those taking part in the WTO multilateral negotiations to do their utmost to break the deadlock and rapidly conclude such an agreement which includes mutual recognition of chosen methods of support to the aerospace industry by all WTO members and well-balanced and effective mechanisms for control of government support levels in all WTO Member States, including emerging producers;

10. Stresses that the multilateral agreement must include clear provisions on mutual consultation and provision of information and an effective mechanism for settling differences;

11. Calls on civil aircraft manufacturers on both sides of the Atlantic to embark on closer cooperation, especially in pre-competitive fields such as the development of new aircraft types and of more environmentally compatible aero engines;

12. Instructs its President to forward this resolution to the Commission, the Council, the governments of the Member States and the United States Administration.