"On January 11, the U.S. agreed with the EU to try to reach a comprehensive agreement to end subsidies for the production and development of large civil aircraft in the European Union and the United States.

"We set ourselves a target of 90 days to complete the negotiations, and agreed that there would be no new subsidies and no WTO dispute settlement proceedings during that time.

"The U.S. regrets that it has not been possible to conclude such an agreement. The United States continues to believe that such an agreement would be a useful solution to this important issue, and remains prepared to negotiate on the basis of the January 11 agreement, including the 'standstill' on subsidies.

"The U.S. is reviewing the situation to determine the best course of action to obtain the elimination of subsidies to Airbus. In the meantime, we will continue to monitor closely the actions of the EU and its Member States with regard to support for large civil aircraft. As the Senate considers Mr. Portman's nomination to be USTR, Deputy Secretary of State Robert B. Zoellick will continue to lead U.S. negotiators.

"In the event that the EU proceeds with additional subsidies for Airbus large civil aircraft, the United States will return to WTO dispute settlement."