U.S. company Boeing, a key rival of Bombardier, had claimed that it was unfair that the latter received subsidies from the United Kingdom and Canada before the tax announcement was made, according to the BBC.
The ruling will be based on information provided by Boeing, Bombardier and the federal government.
Its immediate future was secured after it signed a 5.6 billion USA dollar deal past year to provide up to 125 of its new C-Series aircraft to Atlanta-based Delta Airlines.
Speaking before the ruling, Prime Minister Justin Trudeau promised to continue to stand with Bombardier and Canada’s aerospace industry.
The International Trade Commission, an arm of the Commerce Department, made the decision Tuesday.
The rift began when, in 2016, Delta secured a deal to bring Bombardier’s C series to the us market.
And the leader of the Democratic Unionist Party, Arlene Foster, said she would the use party’s influence with the government to press the issue.
A United Kingdom government spokesperson from the Department for Business, Energy and Industrial Strategy said they were disappointed in the outcome, but emphasised it was “only the first step in the process”.
This would raise serious questions about the future of Bombardier’s purpose-built factory at Queens Island in Belfast, which makes wings for the aircraft….
Bombardier also maintains that the smallest single-aisle 737 does not compete with the CS100, the roughly 110-seat Bombardier model purchased by Delta.
The US Department of Commerce could introduce a preliminary tariff on the C-Series, which would increase the cost of importing the plane to the US, when it publishes its initial findings later. Leitao said Quebec would continue to support Bombardier “because it’s also our company now”.
The aerospace firm was accused of anti-competitive practice by rival Boeing, which complained to the USA authorities.
“The US values its relationships with Canada, but even our closest allies must play by the rules”.
Canadian Foreign Minister Chrystia Freeland said Tuesday evening, while she hosted U.S. Trade Representative Robert Lighthizer at a private dinner in Ottawa, that Canada strongly disagrees with the U.S. tariff ruling.
Boeing wants, and we want, a long-term partnership, but that has to be two-way.
The US court decision is reportedly a huge blow for May, who has made trade relations with the US a key component of the UK’s trade strategy after Brexit.
The minister said his government would re-double efforts with its Canadian counterparts to help bring about a settlement to the bitter dispute.
The case has major implications for Bombardier as it could not only endanger its deal with Delta, but also hinder future sales in the USA and hurt those Canadian aerospace companies that work with Bombardier.
On Wednesday Unite urged Ms May to take action.
For Bombardier, the USA announcement came as a double blow on the same day that news broke of a tie-up between German train-maker Siemens and France’s Alstom to create a rail juggernaut that would compete with Bombardier’s struggling rail division.
The Canadian government said the complaint was just as likely to threaten U.S.jobs as those in Canada and Northern Ireland.
The UK government has contracts with the American aerospace firm in the hundreds of millions of pounds. However, any decision to reconsider Government contracts with Boeing will have to be weighed up against the roughly 16,500 jobs supported by the aerospace giant in the UK.