Bombardier hit with new USA tariff as trade row rumbles on
Oct 08, 2017, 00:45
It added: "The antidumping duty law provides U.S. businesses and workers with a transparent, quasi-judicial, and internationally accepted mechanism to seek relief from the market-distorting effects caused by injurious dumping of imports into the United States".
The duties are in response to a complaint from US competitor, Boeing, that accused Quebec-based Bombardier of selling 75 of its new CSeries jets to Delta Air Lines at below production cost to gain market share and that the government subsidized the project.
Bombardier did not provide the information requested, according to the Commerce Department.
The U.S. decision can be appealed to the U.S. Court of International Trade, the North American Free Trade Agreement or the World Trade Organization, dragging out the conflict.
British Prime Minister Theresa May said she was "bitterly disappointed" by last week's decision, considering Bombardier employs more than 4,000 people in Northern Ireland.
"The United States is committed to free, fair and reciprocal trade with Canada, but this is not our idea of a properly functioning trading relationship", Commerce Secretary Wilbur Ross said in a news release.
In a statement, Boeing said the Department of Commerce had "affirmed the magnitude to which Bombardier has dumped C Series aircraft in the United States, selling those aircraft at prices millions below production cost in an illegal effort to grab market share in the USA single-aisle airplane market".
The US government preliminary decision affects imports of 100-150 aircraft from Canada.
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Canada has accused Boeing of "manipulating the US trade remedy system" to eliminate competition, and vowed to keep raising concerns with the US, Foreign Minister Chrystia Freeland said in a statement.
The government of Quebec, for its part, asserts that the amounts paid to Bombardier are investments and not subsidies.
The C Series wouldn't exist without the assistance of the Canadian and Quebec governments, according to the United States planemaker.
The Commerce Department proposed a 79.82 per cent antidumping duty after a preliminary finding that the jets were sold below cost to Delta Air Lines Inc (DAL.N) in 2016.
Bombardier called the decision an "egregious overreach".
To win its case before the ITC, Boeing must prove it was harmed by Bombardier's sales, despite not using one of its own jets to compete for the Delta order.
The programme also received a billion United States dollars from the Canadian provincial government in Quebec in 2015 when its fortunes appeared to be ailing.
The South American nation began WTO consultations in February, saying Canada ran afoul of trade rules because its policies unfairly bolstered the domestic aerospace industry to the detriment of Embraer SA, an airplane producer based in Sao Jose dos Campos, Brazil.
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Cuban officials say they're disappointed in the U.S. retaliatory measures but will continue cooperating with the investigation. Share with Us - We'd love to hear eyewitness accounts, the history behind an article, and smart, constructive criticism.
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