Introduction

724. We turn now to the European Union's claim concerning the Panel's finding that, on the assumption that the allocation of patent rights under the contracts and agreements between NASA/USDOD and Boeing constitutes a subsidy under Article 1.1 of the SCM Agreement, it would not be specific within the meaning of Article 2.1 of that Agreement. We provide a summary of the Panel's findings in section B. Next, we discuss the Panel's arguendo approach in section C. The European Union's claims on appeal are assessed in sections D, E, and F.

725. Before proceeding, we wish to clarify three aspects about the scope of the appeal that is before us. First, we note that, before the Panel, the European Communities challenged: (i) the allocation of patent rights under NASA/USDOD contracts and agreements; and (ii) the allocation of rights over the data produced under the relevant NASA/USDOD contracts and agreements. The Panel rejected both claims. The European Union's appeal is directed only at the Panel's finding concerning the patent rights and does not include the Panel's finding on the data rights. This was confirmed by the European Union during the oral hearing.

726. Second, we observe that the European Communities challenged the patent rights allocation under NASA/USDOD contracts and agreements independently from its challenge to the payments and other support provided to Boeing under certain NASA/USDOD contracts and agreements.