EADS chief 'enormously frustrated' over WTO delays

LONDON — The head of Airbus parent EADS said he is "enormously frustrated" with the World Trade Organization, which he claims is being "unfair" by delaying its report on complaints against arch-rival Boeing. Both companies have been reported to the WTO, which has struggled for years to rule over whether they benefited from unfair subsidies. "We are in an abnormal and increasingly unfair situation," EADS chief Louis Gallois said at media day in London. His comments were held for release. The problem for the WTO is that the companies are helped in different ways. Airbus benefits from launch aid — low interest government loans for new aircraft programs — while the European Union claims Boeing gains from research and development support and tax breaks. In June, the WTO ruled that Airbus benefited from some illegal subsidies. The ruling was used by Boeing and its supporters to claim that Airbus had an unfair advantage as the two plane makers battle to win a $35-billion US air force contract for refueling jets. Airbus claims 70 percent of Boeing's arguments were defeated, and it was waiting for the WTO to rule on its counter complaint against Boeing to level the playing field. That report, which was due this month, has been delayed until September. "I am enormously frustrated," said Gallois, claiming this was the third delay. However, he said that when it comes to the air force tanker contract, the Pentagon is being fair. "I'm extremely impressed by the way the Pentagon is working with us," he said. "They have put us in the right position to compete." That doesn't mean to say there won't be political opposition to the European company, which through its North American subsidiary is bidding as a prime contractor. "We have a fight in the Congress. We know that," he said. In 2008, EADS was awarded the contract with American partner Northrop Grumman, which was then the prime contractor, but it was overturned on appeal. Northrop then withdrew from the competition saying the Pentagon's guidelines favor Boeing. After initial hesitation, EADS decided to bid alone. —AP