Bizwatch

Fasten Your Seat Belts
Few industrial rivalries are as intense and bitter as the transatlantic, multibillion-dollar dogfight between U.S. airplanemaker Boeing and its France-based nemesis, Airbus. Besides the verbal vitriol the companies consistently exchange — Airbus CEO Noël Forgeard recently accused Boeing of conducting a “campaign of untruths” — governments on both sides of the Atlantic have occasionally pushed the boundaries of diplomacy in trying to promote their respective national champions. Skyrocketing fuel prices and cut-back purchase plans have made the battle fiercer than ever, and last week a full-scale trade donnybrook erupted. Fulfilling a campaign promise, the Bush Administration filed a case with the World Trade Organization accusing the European Union of supplying Airbus with illegal subsidies. The E.U.

INDICATORS
Case Dismissed
A U.S. federal court threw out Hollinger International’s $1.25 billion racketeering case against ex-chairman Conrad Black and other former executives. The Chicago-based newspaper group had claimed the accused looted $400 million of company funds. The judge said the allegations should instead be considered under U.S. securities law.

Lightning Round
The initial public offering by India’s National Thermal Power Corporation sold out in minutes, raising the country’s largest electricity producer $1.2 billion.

Unauthorized Withdrawal
DBS Bank (Hong Kong) promised compensation to savers after it accidentally sent 83 safety deposit boxes to the scrapyard.

Lightning Round
The initial public offering by India’s National Thermal Power Corporation sold out in minutes, raising the country’s largest electricity producer $1.2 billion.

countered with its own case, accusing Boeing of benefiting from “massive” indirect subsidies: Department of Defense and NASA contracts.

A U.S. trade official insisted last week that the Bush Administration is willing to overlook the more than $3 billion in loans European governments have given Airbus in order to get the superjumbo A380, which can carry 550 passengers, off the ground by 2006. But the official wants a commitment from the E.U. to “turn off the tap,” adding that Airbus “should be able to compete on its own.” Washington wants to head off any Airbus subsidy-supported plan to rival the new Boeing 7E7, the fuel-efficient, long-haul plane that will carry between 200 and 300 passengers.

The European Commission accuses Washington of hypocrisy. It insists that not only will the 7E7 benefit from subsidies in the form of a reduced state sales tax, but Japanese and Italian governments are subsidizing their own companies with Boeing subcontracts for the new plane. Some Europeans find the timing of the U.S. challenge suspect. “Is it just a coincidence that the WTO complaint came between two national debates when President Bush is falling in the polls?” ponders a Commission official. Boeing employs 150,000 people in the U.S., and protecting those jobs is one issue on which Democrats and Republicans can agree to agree.

Cleaning Up The Mess
Preliminary hearings for the 29 individuals and three firms accused in connection with the December meltdown of Parmalat began in Milan. Two former Grant Thornton auditors were ordered to stand trial in 2005. Parmalat’s administrator filed a $10-billion suit in the U.S. against Bank of America, alleging it helped mask the state of the Italian dairy firm’s finances.