Officials: Boeing aid in violation

A Boeing B-17F Flying Fortress is parked in at the company’s Plant 2 in Seattle.

GENEVA -- European officials claimed Wednesday that a preliminary decision by the world's top trade court found that aid to U.S. aircraft maker Boeing violated international rules, leading to the prospect that the Chicago-based plane maker may have to forgo or even pay back billions in subsidies.

France's transport and environment ministers said the confidential World Trade Organization ruling delivered to U.S. and EU officials in Geneva "condemns massive subsidies to Boeing that violate WTO rules."

Details of the ruling weren't made public and a final judgment isn't expected to be released for several months.

It comes three months after the WTO found that Boeing's European rival Airbus gained an unfair advantage through billions of dollars worth of low- interest government loans, infrastructure provisions, and research and development grants. Both Washington and Brussels have appealed that decision.

"The ruling swings the pendulum back," the French environment and transport ministers, Jean-Louis Borloo and Dominique Bussereau, said in a statement. "This ruling brings enormous satisfaction to the French and European aviation industry and saves jobs and the future of this industry."

The Office of the U.S. Trade Representative in Washington confirmed receipt of the ruling but would not discuss the contents.

Officials at Boeing didn't comment. Incentives the aerospace giant received in South Carolina as part of its $750 million North

Charleston expansion were not part of the WTO dispute.

Ahead of the ruling's release, a senior Boeing official rejected suggestions that the ruling should be tied to the Airbus case, offering the way for a negotiated settlement between the two parties.

"The two cases are completely separate and deal with very specific issues," Ted Austell, vice president of trade policy at Boeing, said Tuesday.

As diplomatic officials digested the ruling, sources disagreed on the degree to which Boeing benefited from the aid, barred by international trade rules. Also uncertain: Whether the finding was as sweeping as the court's determination this year that France-based Airbus SAS benefited from about $20 billion in illegal subsidies, including $15 billion in below-market-rate launch aid in developing most of its commercial jetliners.

John Clancy, an EU trade spokesman, said the ruling would be studied carefully before Brussels decides how to proceed. But he added that "only negotiations at the highest political levels can lead to a real solution and we hope today's report provides momentum in that direction."

The six-year dispute is seen as key to future funding for new plane development in a market estimated to be worth more than $3 trillion over the next two decades.

Airbus and Boeing are also vying to secure a $35 billion contract to provide aerial tankers to the U.S. Air Force.

The Chicago Tribune and Angela Charlton and Raf Casert of the Associated Press contributed to this report.