By David Ljunggò???ers) - The World Trade Organization ruled on Monday that Ottawa had broken international trade rules by offering a C$1.7 billion ($1.1 billion) low-interest loan to help Canadian jet maker Bombardier (BBDb) sell 75 passenger aircraft to U.S. airline Air Wisconsin. The ruling was the first WTO defeat for Ottawa in a protracted trade battle between Canada and Brazil over subsidies to their major aircraft makers, which are rivals in the regional jet market. Canada claims Brazil has been illegally subsidizing jet-maker Embraer (EMBR3) for years and points out that the WTO has on five occasions ruled against Brasilia's Proex export subsidy scheme. The Canadian government partially welcomed Monday's decision, noting that the WTO had not ruled against Ottawa's overall financing program. It added that Brazil might be keener to push ahead with bilateral talks on ending the dispute now that it had finally won a round at the WTO. But officials told a news conference that Canada could still appeal the ruling and talked tough when asked whether the subsidies would be withdrawn if such an appeal failed. "The government's commitment to Bombardier and its clients and its employees remains firm on the question of Air Wisconsin financing," one official said. When Canada announced the funding last year it said it was merely giving the kind of aid that Brazil provides to Embraer. Air Wisconsin is a United Airlines (UAL) affiliate. The WTO also said Ottawa had broken the rules by offering loans to help Bombardier, the world's No. 3 maker of commercial aircraft, sell planes to Delta Airlines' (DAL) Comair and Spanish carrier Air Nostrum. In total, the ruling covers some 80 aircraft, which have yet to be delivered. Montreal-based Bombardier said it was disappointed by the latest WTO ruling. In 2000 the WTO gave Canada the right to impose a total of $2.1 billion (U.S.) in sanctions over seven years on Brazil over its refusal to scrap export subsidies for a total of 1,118 Embraer aircraft that had yet to be delivered. The WTO's latest ruling rejected eight other Brazilian complaints about allegedly illegal financing of deals by Ottawa and the government of Quebec, the French-speaking province where Bombardier is based. "The WTO final report confirms that Canada's export financing programs meet our international obligations," International Trade Minister Pierre Pettigrew said in a statement. Canadian and Brazilian officials are due to meet in New York on Feb. 8 to hold another round of talks on how to resolve their dispute. Ottawa wants both sides to agree to scrap all subsidies to the two aircraft manufacturers. "At this time we prefer to proceed through a negotiated settlement which would lead to a mutually satisfactory solution on both sides," said one official, who said Brazil might feel happier now that it had won something at the WTO. "We have a better chance of succeeding this time than we had last time. How much better I don't know, we'll see," he told the news conference.