USA/Russia argue over Il-96 Exim Bank deal

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The delivery of 20 Ilyushin Il-96M/Ts to Aeroflot Russian International Airlines is being held up by a US/Russian wrangle over import duties on new Boeing aircraft for the Russian national carrier.

The US Government is believed to have linked the release of $1 billion in Exim Bank funding for Aeroflot's Il-96M/Ts to a Russian deal to exempt from import duties four Boeing 767-300ERs due for delivery by year-end to the carrier.

The matter was raised during high-level US/Russian Governmental talks when the Gore-Stepashin Commission met in Washington last week.

The Il-96T freighter received US Federal Aviation Administration certification in June, clearing the way for deliveries to begin to Aeroflot, subject to the Exim Bank funding release.

US Federal Aviation Administration approval enabled the Il-96T to be registered in a Western country, an Exim bank requirement to ensure the aircraft are easily accessable should the operator default on payments.

When the US funding deal was first discussed, Boeing raised objections, but these were dropped following a 1997 Aeroflot order for 10 Boeing 737-400s. Aeroflot sources say Exim Bank funding of the Il-96s, which have US-supplied engines , avionics and other equipment, was agreed under a framework agreement negotiated with Russia in return for an import tariff exemption. Boeing sees the 767 arrangement as an extension of the 737 deal, but says the tariff issue "is a matter for Aeroflot and the Russian Government."