WTO panel largely backs EU in palm oil case against Indonesia
A World Trade Organization (WTO) panel found largely in favor of the European Union (EU) on Friday in a case brought by Indonesia against the bloc's restrictions on palm oil-based biofuel.
Indonesia, the world's biggest producer of palm oil, brought the case to the WTO in 2019 after the EU concluded that palm oil cultivation results in excessive deforestation and should not count toward its renewable energy targets.
The result was that palm oil-based diesel would not be considered a biofuel and its use in transport fuel would effectively be phased out between 2023 and 2030.
Indonesia said the measures unfairly targeted Southeast Asian palm oil producers.
The three-person panel ruled that the underlying logic of the EU measures to limit greenhouse gas (GHG) emissions was legitimate and that the EU had a reasonable basis to designate biodiesel from palm oil as "high risk."
However, the panel did find fault in the way the EU had prepared, published and administered its measures, such as by not having a timely review of data to determine high risk and not meeting certain transparency obligations.
It also found that the EU gave less favorable treatment to palm oil-based biofuel from Indonesia than accorded to like products of EU origin or imported from third countries.
Malaysia, the world's second-largest producer, brought a similar challenge to the WTO in 2021.
The EU and Indonesia, which are in free trade negotiations, have a number of outstanding cases before the WTO, including over Indonesian curbs on nickel ore exports and EU duties on Indonesian biodiesel and stainless steel.
Comments