Friday, April 1, 2011

Boeing (BA) Received Illegal U.S. Subsidies Rules WTO

According to a ruling by the World Trade Organization, Boeing (NYSE:BA) received a minimum of $5.3 billion in illegal subsidies from the U.S. and state governments from the period between 1989 and 2006.

Competitor Airbus contends it lost about $45 billion in aircraft sales from the subsidies.

Details of the report, which was released on Thursday but concluded in January, said NASA, the Department of Defense, and the states of Washington, Illinois and Kansas gave Boeing the illegal subsidies.

Included in the subsidies were $2.6 in NASA research and development programs, $2.2 billion in foreign sales corporation export subsidies, and a variety of tax breaks and incentives from a number of states and cities.

The Department of Defense also was ruled as having given Boeing illegal subsidies, but it wasn't clear the amount that was provided, according to the report.

Airbus responded to the ruling, saying it has "publicly condemned the United States for giving Boeing massive illegal subsidies that caused Airbus to lose $45 billion in sales."

Even so, a separate WTO trade panel ruled European governments for illegally supporting Airbus after complaints were filed by the U.S.

Expectations are the ruling will now go to a WTO appeals panel.

Boeing closed Thursday at $73.93, gaining $0.13, or 0.18 percent.

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