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WTO ruling says EU has failed to end illegal Airbus subsidies

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A World Trade Organization panel ruled Monday that the European Union has not complied with an order to end illegal subsidies for plane maker Airbus, which prompted the Trump administration to impose tariffs on nearly $7.5 billion US worth of EU goods in October.

In its ruling, a WTO compliance panel found that the EU had not taken sufficient steps to end harm to Boeing, the major rival to Europe’s Airbus. The EU is expected to appeal, though the United States is on the cusp of preventing the WTO’s appeals court — the Appellate Body — from ruling on any new appeals.

U.S. Trade Representative Robert Lighthizer welcomed the WTO ruling. “Strong action is needed to convince the EU that its interests lie in eliminating these market-distorting subsidies now and in the future, so that our industries can compete on a level playing field,” Lighthizer said in a statement.

Responding to Monday’s ruling, the EU’s executive commission faulted the panel for making a “number of serious legal errors in its assessment of EU compliance,” and said its recommended ways of compliance would be “very problematic for a larger part of the WTO membership.”

Possible appeal

“The European Commission will decide on its course of action in light of this assessment, including the possibility of bringing an appeal in order to have these legal errors corrected,” it said in a statement.

The commission also alluded to a decision expected next year by a WTO arbitrator in a case of illegal U.S. government support for Boeing, which could give the EU authorization to slap tariffs on U.S. goods.

The Airbus case centres on so-called launch aid from the EU that WTO judges ruled had dented impeded sales for aircraft from Boeing in the twin-aisle and very large aircraft markets.

This March 6, 2018, file photo shows a logo of Airbus group is displayed in front of its headquarters in Toulouse, France. (Fred Scheiber/The Associated Press)

In May last year, the Appellate Body agreed that the EU and four of its member states — Britain, France, Germany and Spain — had failed to abide by an earlier compliance panel ruling. The EU insisted in subsequent arguments that the subsidies had been lifted, and that proper steps were taken to remove the subsidies’ harmful impact on Boeing.

The panel found that the EU had failed to show that it had succeeded in withdrawing French, German, Spanish and British subsidies for the A380 superjumbo, or German and British subsidies for the A350XWB widebody jet.

Appellate body has final say

A final resolution could be made more difficult because the WTO’s appellate body, which has final say in trade dispute cases, is set to become unable to hear new cases starting next week.

Under WTO rules, the Appellate Body must have at least three members, and the terms of two of its three members are set to expire Dec. 11. The United States has singlehandedly blocked any new appointments, alleging that the body’s members have overstepped WTO rules and draw excessive salaries and perks, among other things.

It is unclear whether the Appellate Body’s three members will continue to work on outstanding cases after the two terms expire. Sometimes, its judges work on pending cases even after their terms expire.

There was no immediate response from the U.S. Trade Representative’s office.

In a statement, Airbus called on the United States to “immediately reduce” the $7.5 billion “by around $2 billion,” arguing that it was directly linked to finding that loans for the development of Airbus’ A380 superjumbo “no longer have an impact on Boeing sales and that therefore the value of the lost sales no longer exists.”

Airbus didn’t elaborate on how it reached that estimate in its statement, and a spokesman did not provide immediate comment to The Associated Press.

The WTO’s dispute settlement understanding, a sort of rulebook for resolving disputes, said that parties in dispute cases need to ensure full implementation of rulings before any WTO go-ahead for lifting of authorized tariffs, and that there can be no “second arbitration” such as in the case of the $7.5 billion arbitration award given to the United States.

In its ruling, the compliance panel said the EU and four member states “failed to implement the recommendations and rulings” of a lower WTO panel to conform with the trade body’s rules.



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Pelosi Says House Will Begin Drafting Impeachment Charges Against Trump

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WASHINGTON — Speaker Nancy Pelosi announced on Thursday that the House of Representatives would begin drafting impeachment articles against President Trump, pushing ahead with a rapid timetable that could set the stage for a vote before Christmas to charge him with high crimes and misdemeanors.

Wrapping her announcement in the words of the Constitution and the nation’s founders, Ms. Pelosi said it had become clear over the course of two months of investigation that Mr. Trump had violated his oath of office by pressing a foreign power for help in the 2020 election. Allowing Mr. Trump to continue in office without remedy, she said, would come at “the peril of our republic.”

“His wrongdoing strikes at the very heart of our Constitution,” Ms. Pelosi said in a formal address lasting less than six minutes, delivered against a backdrop of American flags from the balcony outside her office in the Capitol. “Our democracy is what is at stake. The president leaves us no choice but to act because he is trying to corrupt, once again, the election for his own benefit.”

Ms. Pelosi’s hastily arranged announcement came a day after the House Judiciary Committee began formal impeachment proceedings against Mr. Trump, convening a hearing where three constitutional scholars invited by Democrats said Mr. Trump had engaged in conduct that clearly met the definition of impeachable offenses under the Constitution.

“If you are going to impeach me, do it now, fast, so we can have a fair trial in the Senate, and so that our Country can get back to business,” he wrote.

Ms. Pelosi limited knowledge of her announcement to only a tight circle of advisers, but there have been clear signs this week that Democrats were preparing to move forward with impeachment articles. On Wednesday, after the legal scholars told the Judiciary Committee the facts of the case met the standards for impeachment, the committee’s chairman, Representative Jerrold Nadler of New York, said explicitly that the conduct fit his three-part test for impeachment and indicated his panel would move forward with that in mind.

First, the Judiciary Committee is expected to announce a hearing in the coming days for Intelligence Committee lawyers for present their findings. But people familiar with the matter believe the committee is on track to begin publicly debating and voting in articles by the end of next week.

On Wednesday, Mr. Nadler’s team made clear it was considering building charges going beyond the Ukraine matter, related to obstruction of the House’s inquiry. A lawyer for the chairman, Norm Eisen, also asked the witnesses to also evaluate whether possible obstruction of justice by Mr. Trump laid out by Robert S. Mueller, the special counsel who investigated the Trump campaign’s connections to Russia’s interference in the 2016 election, was also impeachable. The Democratic caucus, and Ms. Pelosi, though, may still ultimately decide to keep the case more narrowly focused on Ukraine.

The Intelligence Committee report released on Tuesday laid out a broad framework for what articles of impeachment might look like. It found that the president had abused his power, endangered national security for his own personal benefit by seeking foreign interference in the 2020 election, and had obstructed justice by ordering critical witnesses not to testify.





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House Democrats: Trump Abuse of Power Impeachable Offense

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Congressional Democrats launched the next step in the impeachment of U.S. President Donald Trump Wednesday, hearing testimony from legal scholars on what the U.S. Constitution says about the standards for impeaching and removing a president from office. The House Judiciary Committee hearings take lawmakers a step closer to a vote on Articles of Impeachment, measures that if passed would lead to a Senate trial. VOA’s congressional correspondent Katherine Gypson has more from Capitol Hill.
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Saudi Arabia denies pushing OPEC allies for deeper cuts, source says

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OPEC Secretary General Mohammed Sanusi Barkindo (L) and Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman (R) attend an Opec-JMMC meeting in the UAE capital Abu Dhabi on September 12, 2019.

KARIM SAHIB | AFP | Getty Images

OPEC kingpin Saudi Arabia has denied pursuing a deeper round of production cuts, one senior oil official told CNBC on Thursday, despite intense speculation the global oil-producing group was on the cusp of imposing further output curbs.

The oil-rich kingdom was widely considered to be pushing for other OPEC members to sign up for at least an additional 400,000 barrels per day (bpd) of production cuts. But, one anonymous Saudi oil official told CNBC on the sidelines of a meeting in Vienna, Austria that this was not the case — and Riyadh had not proposed any figures.

OPEC and non-OPEC allies — sometimes referred to as OPEC+ — have gathered in Vienna this week to discuss the next phase of their oil production policy. The 14-member group will hold talks on Thursday, before meeting with non-OPEC allies, including Russia, on Friday.

The energy alliance has reduced output by 1.2 million bpd since the beginning of the year. The current deal, which runs through to March 2020, replaced a previous round of production cuts that began in January 2017.

International benchmark Brent crude traded at $63.53 on Thursday afternoon, up more than 0.8%, while U.S. West Texas Intermediate (WTI) stood at $58.76, approximately 0.5% higher.

Oil prices have rallied in recent trading sessions, boosted by growing speculation about the potential for deeper production cuts.

However, Brent crude futures remain around 15% lower when compared to an April peak, with WTI down 12% over the same period.

— CNBC’s Dan Murphy, Hadley Gamble and Emma Graham contributed to this report.



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