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(as cited in request for consultations)
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The summary below was up-to-date at
Complaint from the United States.
On 21 May 1999, the
US requested consultations with the EC in respect of alleged actionable
subsidies granted or maintained to a French company, Sextant Avionique
(“Sextant”), to develop a new flight management system
(“FMS”) adapted to Airbus aircraft. The US alleged that the
French government has agreed to grant, and the European Commission has
approved, a loan, on preferential and non-commercial terms, in the amount
of 140 million French francs, to be disbursed over three years, for a
project in which Sextant will develop a FMS adapted to Airbus aircraft.
The US considered that this aid:
- is a specific subsidy within the meaning of Articles 1
and 3 of the SCM Agreement, which subsidy has caused and continues to
cause adverse effects within the meaning of Article 5 of the SCM
- has caused and continues to cause serious prejudice
within the meaning of Articles 5(c) and 6 of the SCM Agreement because the
subsidy may involve the direct forgiveness of debt;
- may displace or impede imports of FMS from the United
States into France;
- may displace or impede exports of FMS from the United
States to third country markets;
- may cause significant price undercutting by the
subsidised product as compared with the price of a like product of another
Member in the same market or may cause significant price suppression,
price depression or lost sales in the same market; and
- has caused and continues to cause a nullification or impairment of
benefits accruing directly or indirectly to it under GATT 1994 within the
meaning of Article XXIII:1(b) of GATT 1994, and Article 5(b) of the SCM
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