The EU said Tuesday that Washington had failed to end illegal subsidies for US aerospace giant Boeing as ordered and it was therefore taking the dispute back to the World Trade Organization.
"A review of US efforts to comply with a WTO ruling on illegal subsidies in the so-called 'Boeing case' by the European Union shows that the US has not lived up to its obligations," a statement said.
"The European Commission therefore decided to challenge the US non-compliance at the WTO."
The WTO ruled in March that billions of dollars of subsidies to Boeing were illegal and notified the United States to bring them to an end by Monday.
US authorities said on Sunday that they had worked for the past six months with governmental bodies including space agency NASA, the Defense Department, the north-western state of Washington and the city of Wichita, Kansas, to ensure conformity with the WTO ruling.
On Monday, the office of European Union Trade Commissioner Karel De Gucht confirmed it had received the US notice and the European Union executive would immediately check whether Washington was in compliance.
"We are disappointed that this does not seem to be the case," De Gucht said in the statement Tuesday.
"We had expected that the US would have finally complied in good faith with its international commitments and would have abided by the WTO rulings that clearly condemned US subsidies to Boeing," he added.
"So, the US leaves us with no other choice but to insist on proper compliance before the World Trade Organisation. We are confident that this process will finally lead to a level playing field in the aircraft sector."
The EU said the WTO's Appellate Body had found that US federal and state governments granted $5.0 billion-6.0 billion in WTO-incompatible subsidies to Boeing between 1989 and 2006.