U.S. increases import tariffs on Bombardier C-Series planes

Further tariff of 80% imposed on import of C-Series

US escalates trade dispute with UK and Canada over Bombardier

In another high-stakes trade battle, the U.S. Commerce Department on Friday proposed increasing tariffs on Bombardier CSeries jets to 300% after determining that the Canadian firm sold the aircraft below cost to Delta Air Lines.

Boeing asserts that Bombardier has benefited from the financial support of the government to sell its devices at a very low price, which results, according to the u.s. manufacturer in an unfair competition.

Bombardier called Washington's latest decision "an egregious overreach and misapplication" of US trade laws to prevent its C Series aircraft from entering the USA market, and accused Boeing of also selling planes below production cost "for years".

The spiralling cost, which could more than triple the price of the jets sold in the United States could also threaten the order for over 75 aircraft from Delta Airlines.

Ottawa, for its part, said that its loan to Bombardier complies with all the rules of the world trade Organization (WTO). The duties would be applied to Bombardier's CSeries when delivered to Delta Airlines from the spring of 2018.

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The hit is on top of an earlier tariff of almost 220 per cent, relating to subsidies Bombardier received from Canada and the UK.

The row has caused concerns over jobs in the United Kingdom, with Bombardier employing some 4,000 people in Northern Ireland.

Bombardier Inc's aerospace business spent $2.4 billion in the United States previous year, tapping more than 800 suppliers in all but three USA states, according to a confidential Bombardier report seen by Reuters on Thursday.

Last month, defence secretary Michael Fallon said: "This is not the behaviour we expect from Boeing and it could indeed jeopardise our future relationship with them".

Bombardier can appeal any sanctions to a USA court or to a dispute-resolution panel created under the North American Free Trade Agreement.

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Bombardier shares were last up 0.5 percent to C$2.20. But Delta has said Boeing did not even make the 100-seat jets it needed.

Boeing has said the dispute was about "maintaining a level playing field" and was not an attack on Canada or Britain.

USA commerce secretary Wilbur Ross said: "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".

"We will continue to verify the accuracy of this decision, while [doing] everything in our power to stand up for American companies and their workers", he added.

The firm also took umbrage with Bombardier receiving $1bn (£765m) from the Canadian provincial government in Quebec in 2015, when its fortunes appeared to be flagging. The plane supports an estimated 22,700 jobs and Bombardier's aerospace division spent $2.14 billion in the United States a year ago, according to the company and documents seen by Reuters.

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