In his statement, Ambassador Lighthizer indicated that the United States also wished to negotiate a settlement to a WTO dispute that began in 2004, noting that he was "waiting for a response from the European Union to a recent USA proposal and will intensify our ongoing negotiations with the European Union to restore fair competition and a level playing field to this sector".
The Tuesday decision marks the consummation of a 16-year-long legal battle before the WTO.
This week the World Trade Organization allows the EU to respond to the charges imposed by Washington following a similar ruling last October, under which the United States won the right tariffs .5 7.5 billion EU goods, This affected aircraft parts and luxury goods based on the European Government's objections to the rival space team Airbus. In 2019 US President Donald Trump imposed taxes on various European goods including planes, wine and cheese, after the WTO gave the US the option to counter on up to $7.5 billion of annual European exports. Washington could raise those import taxes to 100%, which for many European products would effectively block their entry into the US marketplace. He added: "Because Washington State repealed that tax break earlier this year, the European Union has no valid basis to retaliate against any USA products".
Under the United States offer, interest rates on past loans to support Airbus development programmes would be reset to a level that assumed only half the projects would succeed. The two cases combined constitute the largest ever corporate trade dispute, costing an estimated $100 million since 2004.
That would mean a higher risk than Airbus partner nations - Britain, France, Germany and Spain - have traditionally priced into the loans and reflects a speculative type of investment.
One European source called the proposal "insulting" and said it could accelerate the tariff war.
A USA source, meanwhile, said Lighthizer was "serious" about getting Airbus to hand back aid. Both sides have urged negotiations while accusing the other of refusing to engage seriously. The Commission said its proposals covered future aid for the sector.
He said: "Mr Lighthizer has been very public on the basic principle that some form of restitution is an important part of any resolution".
Following the publication of the WTO report on the Boeing dispute earlier this week, 13 European associations representing sectors threatened or hit by USA tariffs as part of the Airbus dispute have urgently called on the European Unionand the United States to de-escalate the disputes, work on a negotiated solution and stop targeting unrelated sectors.
Airbus said the disputed system favoured taxpayers because loan repayments on successful jets such as the A320 far outweighed amounts written off on jets that failed to reach sales targets.