(KPL/VNA) Indonesia on August 25 urged the European Union (EU) to immediately scrap countervailing duties on imports of biodiesel, after the World Trade Organisation backed several of its key claims in a complaint to the trade body.

The Southeast Asian nation – the world's biggest palm oil exporter, had contended in its 2023 complaint that the duties levied by the EU broke the WTO's rules.

Indonesian Trade Minister Budi Santoso stressed in a statement that his country calls on the EU to immediately revoke these countervailing import duties that are not WTO-compliant.

The EU, the third-largest destination for palm oil products from Indonesia and a key market for biodiesel of this country, has imposed the duties, ranging from 8% to 18%, since 2019. The union said Indonesia's biodiesel producers benefit from grants, tax benefits and access to raw materials below market prices.

The Indonesian Ministry of Trade said that the WTO panel had assessed that Indonesia’s export duty and export levy on palm oil could not be categorised as a subsidy, and that the EU Commission failed to prove a threat of material harm to European biodiesel producers caused by Indonesian biodiesel imports. Therefore, the WTO panel determined that the countervailing duty that the EU imposed on Indonesian biodiesel was not based on objective evidence.

Indonesia's exports of palm oil-based biodiesel stood at 27,000 kilolitres (kl) in 2024, after having plunged to 36,000 kl in 2020 from 1.32 million kl in 2019.

The finding can be appealed, but no final ruling is possible since the WTO’s top appeals court is no longer operational.

KPL