Indonesia hails WTO ruling against EU on biodiesel

January 17, 2025 (MLN): Indonesia welcomed a World Trade Organization (WTO) ruling in its favor against the European Union over palm oil-based biodiesel, anticipating that the EU will adjust its regulations to align with the decision.

Indonesia, the world's largest palm oil producer, brought the case to the WTO dispute body in 2019 after the EU decided that palm oil-based diesel would not be considered a biofuel.

The EU also announced plans to phase out its use in transport fuel between 2023 and 2030, citing concerns over deforestation.

Indonesia argued that the EU is using climate issues as a pretext to implement protectionist trade measures.

The Indonesian government welcomes the WTO panel decision, as Reuters reported.

“We hope that in the future, other trading partner countries will not implement similar policies that have the potential to hinder the flow of global trade," Trade Minister Budi Santoso said in a statement late on Thursday.

The three-person panel ruled last week that the EU's measures to limit greenhouse gas emissions were legitimate.

However, it also determined that the EU had a reasonable basis to classify biodiesel from palm oil as "high risk."

The panel criticized the EU for how it prepared, published, and administered its measures.

Specifically, it pointed out the failure to conduct a timely review of data to determine high-risk status and the failure to meet certain transparency obligations.

The EU was also found giving less favorable treatment to palm oil-based biofuel from Indonesia than accorded to like products of EU origin or imported from third countries.

The Indonesian trade ministry stated that the EU will be compelled to adjust its policy to comply with the ruling.

It also added that Indonesia will closely monitor the EU's regulatory changes to ensure they align with the WTO body's recommendations.

Copyright Mettis Link News