Background

The U.S. and the United Kingdom will continue to suspend for five years tariffs on two-way trade imposed in a long-running dispute over aircraft production subsidies.

The U.S. tariffs, most of which are 25 percent, had been imposed on UK goods such as cheese, fruit, olives, wine, single-malt Irish and Scotch whiskies, sweaters, pullovers, sweatshirts, performance outerwear, suits, pajamas, swimwear, blankets, bed linen, printed books, lithographs, pictures, and self-propelled machinery. These tariffs, along with those the UK had imposed on U.S. goods, had previously been suspended through July 4 to give the two sides time to negotiate an agreement.

The conditions of the suspension appear the same as those previously announced between the U.S. and the European Union. Both sides pledged to contribute to establishing fair competition in the large civil aircraft industry. Toward this end, they will establish a trade minister-led working group that will meet at least every six months to address disagreements, including on existing support measures. They also committed to providing their respective LCA producers with financing on market terms and research and development funding through an open and transparent process.

The working group will also be a primary forum for confronting China and other non-market economies in this sector. Work in this area will include sharing information on cybersecurity concerns, exploring common approaches and enhanced cooperation on screening inward and outward investments in the LCA sector to prevent detrimental technology transfer or appropriation, and clarifying the extent of state support in non-market economies “with the goal of establishing the basis for joint or parallel action in the future.”

For more information on this tariff suspension, please contact Nicole Bivens Collinson (at (202) 730-4956 or via email) or Kristen Smith (at (202) 730-4965 or via email).

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