WTO Backs Indonesia in Challenge to EU Biodiesel Duties

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By Bryce Baschuk

The European Union erred when it imposed anti-dumping duties on Indonesian biodiesel imports, according to a World Trade Organization ruling issued Jan. 25.

A WTO dispute settlement panel generally backed Indonesia’s argument that the EU applied improper production costs when it calculated anti-dumping duties on Indonesian biodiesel imports. Biodiesel is a renewable fuel produced from vegetable oils and animal fats that are used in diesel engines.

The EU applied excessive anti-dumping duties based on artificial estimates of costs, profits, and prices that ignored actual data from Indonesian producers and exports, the WTO said.

The WTO is now calling on the EU to withdraw the duties at issue. Although the EU could appeal the WTO verdict, the 28-nation bloc will probably reduce or refund its duties for Indonesia, since it did so for Argentina two years earlier.

WTO rules permit either party to appeal the dispute ruling within 60 days.

Reflects Argentina Ruling

The ruling comes two years after the WTO found the EU’s duties on biodiesel imports from Argentina violated the terms of the WTO’s Anti-Dumping Agreement.

The Jan. 25 decision relied on many of the findings in the 2016 Argentina biofuel dispute and reached the same conclusion: that the EU had applied a faulty methodology in calculating its biodiesel duties.

The European Union agreed in 2017 to reduce by two-thirds its tariffs on Argentine biodiesel imports to comply with the 2016 ruling.

Argentinian and Indonesian exports previously accounted for 90 percent of all EU biofuel imports, but their imports dropped dramatically after the EU imposed its anti-dumping duties in 2013.

To contact the reporter on this story: Bryce Baschuk in Geneva at correspondents@bloomberglaw.com

To contact the editor responsible for this story: Jerome Ashton at jashton@bloomberglaw.com

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