Report of the Panel – Part I

Summary

INTRODUCTION

Complaint of the United States

1.1 On 6 October 2004, the United States requested consultations with the European Communities and certain EC member States (Germany, France, the United Kingdom, and Spain) pursuant to Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”), Article XXIII:1 of the General Agreement on Tariffs and Trade 1994 (“GATT 1994”) and Articles 4, 7 and 30 of the Agreement on Subsidies and Countervailing Measures (“SCM Agreement”)(to the extent that Article 30 incorporates Article XXIII of the GATT 1994), with regard to measures affecting trade in large civil aircraft. Consultations were held on 4 November 2004, but the parties failed to resolve the dispute.

1.2 On 31 May 2005, the United States requested the establishment of a panel pursuant to Article 6 of the DSU, Article XXIII:2 of the GATT 1994, and Articles 4, 7 and 30 of the SCM Agreement (to the extent that Article 30 incorporates Article XXIII of the GATT 1994). In its request for establishment of a panel, the United States requested that the Dispute Settlement Body (the “DSB”) initiate the procedures provided in Annex V of the SCM Agreement pursuant to paragraph 2 of that Annex.