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The World Trade Organization (WTO) on Monday formally authorised the European Union to impose sanctions on the United States in retaliation for subsidies to planemaker Boeing, the European Commission said.

“The European Commission is preparing the countermeasures, in close consultation with our member states,” EU trade chief Valdis Dombrovskis said in a statement, adding that he was still negotiating a way out with Washington over European subsidies to rival planemaker Airbus.

“In the absence of a negotiated outcome, the EU will be ready to take action in line with the WTO ruling,” he said.

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