Comment On The Case Of European Union Prosecuting The United States For Subsidy On Large Civil Aircraft

The European Union and the United States have had several disputes on large civil aircraft.The latest dispute is the one which numbered DS487.The European Union thought the state of Washington in the United States' "Engrossed Substitute Senate Bill 5952" which issued in 2013 provided Boeing with tax preferences and it was in violation of the WTO subsidy regulations.Thus,on 19 December 2014,the European Union requested consultations with the United States.On 23 February 2015,the Dispute Settlement Body established a panel and issued its report of the panel on 28 November 2016.This paper analyses the main focuses of this dispute,and provides references to our country's tax policy and subsidy policy on large civil aircraft.This paper includes three parts:The first part makes a brief introduction about the basic facts,the panel's findings and suggestions of this dispute.The panel concludes that each of the seven aerospace tax measures at issue in the present case constitutes a subsidy within the meaning of Article 1 of the SCM Agreement.The panel also concludes that although the aerospace tax measures at issue are not subsidies de jure contingent upon the use of domestic over imported goods,they are subsidies de facto contingent upon the use of domestic over imported goods.The panel recommends that the United States withdraw these measures without delay and within 90 days.The second part analyses the main four focuses in the dispute.On the basis of the points of the complaining member,the complaint and the panel,it analyses this dispute in combination with SCM Agreement.The first focus of the dispute is that "whether there is a financial contribution as 'government revenue that is otherwise due is foregone or not collected'".The second focus of the dispute is that "whether the challenged measures are prohibited subsidies under Article 3.1(b)of the SCM Agreement".The third focus of the dispute is that "whether the subsidies are de jure contingent upon the use of domestic over imported goods".The fourth focus of the dispute is that "whether the subsidies are de facto contingent upon the use of domestic over imported goods".The third part analyses the dispute's influence and references on China.In this part,this paper analyses seven countervailing investigations of our country's tax policies.This paper also illuminates our countries tax policies which may cause other countries to initiate countervailing investigations.On this basis,the paper suggests that our country can take example by the dispute,attach great importance to the relevant case studies,cancel the remaining prohibitive subsidies,adjust tax preferential policies,improve and standardize the system of export tax rebates,dilute the government's role in subsidy.By reviewing the dispute and taking the findings of the panel as example,we should adjust our countries' tax preferential policies and large civil aircraft subsidy policies.