AIR Airbus SE

By Emre Peker 

BRUSSELS -- The U.S. is entitled to levy tariffs on $7.5 billion of exports from the European Union over the bloc's subsidies to Airbus SE, the World Trade Organization said, potentially opening up a new front in the Trump administration's global trade fight.

The WTO decision on Wednesday concludes part of a 15-year battle over support programs for aircraft makers Airbus and Boeing Co. The WTO will rule on a separate EU case against U.S. subsidies to Boeing, also previously deemed illegal, in the first half of next year, determining the value of U.S. exports the EU will be permitted to hit with tariffs.

The ruling sets up a collision between allies that have long resolved most disagreements without resorting to duties. EU officials in Brussels have proposed negotiating a settlement to avoid tit-for-tat tariffs, but U.S. officials say Europe must first comply with WTO rulings. The standoff risks escalating trade tensions at a critical time.

President Trump is poised to decide by Nov. 13 whether to levy tariffs on EU cars and auto parts, raising the threat of a rapid escalation of trans-Atlantic duties on goods worth some $100 billion. Leaders of a new EU administration, slated to take office Nov. 1, have urged Mr. Trump to avoid a trade war.

Write to Emre Peker at emre.peker@wsj.com

(END) Dow Jones Newswires

October 02, 2019 10:19 ET (14:19 GMT)

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