WTO Panel Says EU Erred in Parts of CVD Investigation on Indonesian Biodiesel
A dispute panel at the World Trade Organization on Aug. 22 found that the European Commission violated its WTO commitments in imposing countervailing duties on biodiesel from Indonesia. The panel found that the commission erred in finding that the Indonesian government provides a countervailable subsidy to biodiesel producers via the provision of crude palm oil and in concluding that Indonesian biodiesel imports "cause a threat of material injury to EU biodiesel producers."
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However, the panel did find that Indonesia failed to prove EU violations of WTO commitments related to various other elements of the investigation, including the commission's finding that a countervailable subsidy is provided via the oil palm plantation fund.
Regarding the provision of crude palm oil, the panel said the EU violated the Agreement on Subsidies and Countervailing Measures by finding that the Indonesian government induced the domestic crude palm oil suppliers to provide the product below cost via "an export tax and export levy, and by de facto acting as a price setter in the domestic" market.
Related to the finding that Indonesian biodiesel injures the EU market, the panel said the EU erred by "failing to make an objective examination, on the basis of positive evidence, of the effect of Indonesian imports on the prices of domestic like product." The commission also "improperly found significant price depression" and illegally concluded that the "totality of threat factors that the Commission examined indicated that 'the fragile economic condition of the Union industry is likely to be aggravated by the imminent and continuing subsidised imports of biodiesel from Indonesia,'" the panel said.
The panel additionally said the EU didn't err in allegedly failing to disclose certain information in the investigation.