US launches investigation into Canadian aircraft imports

The Trump administration today launched an investigation into planned imports of Canadian aircraft, following a complaint last month by the US aviation giant Boeing.

Published: 19th May 2017 04:27 AM  |   Last Updated: 19th May 2017 04:27 AM   |  A+A-

A plane flies over a Bombardier plant in Montreal, Quebec, Canada on January 21, 2014. | Reuters

By AFP

WASHINGTON: The Trump administration today launched an investigation into planned imports of Canadian aircraft, following a complaint last month by the US aviation giant Boeing that the planes receive unfair subsidies.

The anti-dumping investigation will look into charges Canada's Bombardier receives subsidies of nearly 80 per cent, and could lead the US Commerce Department to impose punitive import duties of that amount.

The preliminary ruling on the 100-150-seat planes is due by June 12.

"The US market is the most open in the world but we must take action if our rules are being broken," Commerce Secretary Wilbur Ross said in a statement.

The latest trade dispute came as the Trump administration announced it had begun the process of renegotiating the North American Free Trade Agreement, a 1993 trade pact which binds the United States, Canada and Mexico, but which President Donald Trump has branded a "disaster".

The petition followed Washington's decision to slap tariffs on Canadian imports of softwood lumber. Since Trump took office in January, an aggressive stance on trade has set relations with America's neighbours on edge.

Boeing complained last month that Bombardier was marketing its C Series passenger jets in the United States for less than it costs to produce them, which could undercut sales of Boeing 737 passenger jets.

Boeing called on the Commerce Department to examine Bombardier's "illegal and unfair" practices.

The Canadian aircraft subject to the investigations have not yet been imported, but the Commerce Department cited an April 2016 statement announcing the pending sale of Bombardier aircraft to Delta Air Lines in an order valued at USD 5.6 billion.

Bombardier said last month it worked to ensure compliance with the laws of countries where it operates and spent about USD 3 billion annually with American suppliers.

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