Energy & Environment, Indonesia, Trade defence

ECJ annuls Indonesia and Argentina biodiesel antidumping duties

biodieselThe Court of Justice of the European Union has asked the European Commission to annul current antidumping duties applied to biodiesel from Indonesia and from Argentina.

 

The EU’s antidumping duties levied on biofuels, be they from the US, or from Argentina and Indonesia (Council Implementing Regulation N 1194/2013 concerning both Indonesian and Argentinean biodiesel) are gradually being eroded by high profile legal cases.

 

In March 2016, the EU lost a case brought by Argentina in the WTO on imports of its biodiesel. Indonesia brought its own separate case to the WTO which is still pending.

 

This year, the Court of Justice of the EU also annulled antidumping duties on biodiesel from the United States. On 15 September, it is the duties on Indonesian and Argentinean products that were slapped down by the EU’s court in Luxemburg.

 

All cases address the way the EU calculates injury margins for EU importers, involving the prices of inputs of raw materials. In these biofuel cases, the EU deviated from standard calculation methodologies due to the fact that it considered raw material inputs into the production process of the biofuels too low. The Commission believes these prices are due to distorted domestic policies, such as subsidies or export taxes.

 

In the Indonesia case, the Court of Justice said the EU did not take into consideration that Indonesia’s export taxes on the final product (2-5%) were much lower than the export taxes of the main input, crude palm oil (15-20%). In the Argentina case, “the institutions failed to establish to the requisite legal standard that there was appreciable distortion of the prices of the main raw materials in Argentina as a result of the DET system, in that it included differential rates for export taxes on the main raw materials and biodiesel.” Argentina’s DET an export tax system.

 

The European Biofuels Board, the industry group behind the antidumping cases, hopes for an appeal of the measure. Noting that the Court of Justice did not per se exclude the possibility for the EU to introduce antidumping measures on the grounds that government policies distort local import prices, the group believes this can still justify a resort to antidumping cases.

 

In a statement, the EBB said it “is confident that in the context of an appeal before the Court of Justice, it will be possible to demonstrate that such export taxes have indeed caused an appreciable distortion that was evidenced throughout the investigation.”.

 

 

 

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