Bombardier Contents

Conclusions and recommendations

Complaint by Boeing

1.Boeing used US trade procedures to make a serious complaint against a competitor. As a US company, it is within Boeing’s rights to use those procedures. We question, however, the motivation behind Boeing’s decision to petition the Department of Commerce. In our view Boeing’s complaint against Bombardier was not founded on a genuine threat of existing unfair competition; it was a cynical attempt to prevent an innovative rival with a competitive edge from entering into the US market. (Paragraph 20)

2.We welcome the determination by the International Trade Commission that C-Series imports do not harm, or threaten to harm, the US domestic industry. This is, in our view, the correct determination and vindicates the clear evidence we heard that Boeing has suffered no harm and is consistent with Boeing’s unconvincing evidence to the contrary. The Government should, however, take careful note of the readiness of an American interest to take an aggressive stance. The Government should also note that the Brazilian Government’s complaint against Bombardier is ongoing in the World Trade Organisation. The Government should work to ensure the result reached by the WTO is the same as the International Trade Commission’s determination (Paragraph 21)

Efforts to intervene

3.We welcome the efforts made by the UK Government and others to persuade Boeing to drop its complaint and to persuade the US Administration to intervene on Bombardier’s behalf. Those efforts may have lead, directly or indirectly, to the ITC’s decision to rightly throw out the tariffs. Those efforts did not, however, persuade Boeing to withdraw their complaint, despite the negative impact the tariffs would have had on Northern Ireland. It is possible that Boeing will appeal the decision or raise further complaints against Bombardier in the future. Unless Boeing confirm that it respects the ITC’s decision and will not appeal it, we recommend that the UK Government undertake a review of all contracts held with Boeing. We further recommend that the Government follow the approach of the Canadian Government and stipulate that, in future contract bids, the past behaviour of companies in relation to economic harm to the UK will be considered. (Paragraph 27)

Securing jobs in Belfast

4.The determination by the US International Trade Commission should be celebrated. The hope is that, with the threat of tariffs lifted, Bombardier will expand its operations and thrive. In the absence of an Executive, we recommend that the UK Government work with Bombardier, Invest NI and the Department for the Economy to ensure the Airbus venture produces the best possible outcome for workers in Northern Ireland. (Paragraph 31)

Future risks

5.The International Trade Commission has not published information on whether it considered subsidies from the UK and Canadian Governments to be prohibited or not. This information may be available in due course. It is possible that the ITC found the subsidies to be prohibited but that they did not result in imports that were harmful to the US domestic industry. The Government should no longer assume that RLIs are low-risk and will always be considered as compliant. The Government should conduct an audit of all Repayable Investment Loan provisions or similar it has made to UK companies. Risk assessments should be then conducted particularly where companies have significant business in the US market. Any audit and risk assessment should also consider companies where funding has come from other Governments but where punitive measures such as tariffs could have a significant impact on UK workers. (Paragraph 38)

7 February 2018