August 25, 2025 | 03:13 pm
TEMPO.CO, Jakarta - Indonesia is urging the European Union (EU) to immediately revoke its countervailing duties on Indonesian biodiesel products after a win in the DS618 trade dispute at the World Trade Organization (WTO).
"We urge the EU to immediately revoke the countervailing duties that are not in line with WTO rules," said Minister of Trade Budi Santoso in a written statement on Monday, August 25, 2025.
The European Commission initially imposed these duties, arguing that Indonesia’s government was providing unfair subsidies to its biodiesel producers.
The EU claimed these subsidies were channeled through various policies, including those related to raw material provision, export duties, export levies, and reference price determination for the palm oil sector. The EU asserted that these alleged subsidies distorted market prices and harmed its domestic industry.
However, the WTO determined that the EU had acted inconsistently and violated key provisions of the WTO Agreement on Subsidies and Countervailing Measures. According to Budi, the WTO's decision was based on several critical findings.
First, the WTO rejected the EU's argument that the Indonesian government was directing businesses to sell palm oil to biodiesel producers at artificially low prices.
Second, the WTO concluded that Indonesia's policies on export duties and palm oil export levies do not qualify as subsidies under international trade rules. Finally, the WTO stated that the EU failed to provide sufficient evidence of the material threats experienced by European biodiesel producers as a result of Indonesian biodiesel exports.
Budi further explained that the WTO Panel found the European Commission had overlooked other factors influencing the region’s biodiesel market dynamics. "Thus, the WTO Panel judged that the countervailing duties imposed by the EU on Indonesian biodiesel products were not based on objective evidence," Budi stated.
According to Budi, this victory validates Indonesia's commitment to international trade rules and refutes the EU's allegations of distortive policies. "This victory also proves that the WTO remains relevant as a forum for trade dispute resolution," he added.
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