WT/DS 618/1, G/L/1 486 
G/SCM/D13 6/1 
 
15 August  2023 
(23-5532) Page: 1/4 
  Original: English  
 
EUROPEAN UNION  – COUNTERVAILING DUTIES ON IMPORTS OF BIODIESEL FROM 
INDONESIA  
REQUEST FOR CONSULTATIONS BY INDONESIA  
The following communication, dated  11 August 2023 , from the delegation of Indonesia  to the 
delegation of the European Union , is circulated to the Dispute Settlement Body in accordance with 
Article 4.4 of the DSU.  
_______________  
My authorities have instructed me to request consultations with the European Union ("EU") pursuant 
to Articles  1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of 
Disputes ("DSU"), Article 30 of the Agreement on Subsidies and Countervailing Measures ("SCM 
Agreement"), and Article XXIII:1 of the General Agreement on Tariffs and Trade 19 94 ("GATT 
1994"), concerning the imposition of countervailing duties on imports of biodiesel from Indonesia.  
The measures that Indonesia would like to address in these consultations are the definitive 
countervailing duties on imports of biodiesel from Indo nesia as well as the underlying investigation 
that led to the imposition of these measures (hereafter "countervailing measures"). This request 
also covers any future action or measures the EU may take in connection with these measures.  
The countervailing measures are evidenced by the Commission Implementing Regulation (EU) 
2019/2092 of 28 November 2019 imposing a definitive countervailing duty on imports of biodiesel 
originating in Indonesia1 ("the Biodiesel Definitive CVD Regulation") as well as the Comm ission 
Implementing Regulation (EU) 2019/1344 of 12 August 2019 imposing a provisional countervailing 
duty on imports of biodiesel originating in Indonesia ("the Biodiesel Provisional CVD Regulation")2 
Indonesia is concerned that the Biodiesel Definitive CVD Regulation, the Biodiesel Provisional CVD 
Regulation and the investigation leading to the imposition of the countervailing measures are 
inconsistent with the following provisions of the SCM Agreement and the GATT 1994:  
1. DETERMINATIONS CONCERNING THE OIL PALM PLANTATION FUND ("OPPF")  
(a) Article 1.1(a)(1)(i) of the SCM  Agreement because the EU determined that OPPF 
payments constituted a financial contribution by a public body;  
(b) Article 1.1(a)(1)(i) of the SCM Agreement because the EU determined that OPPF 
payments constituted grants and not purchases of biodiesel by t he Government of 
Indonesia;  
(c) Article 1.1(b) of the SCM Agreement because the EU determined that  OPPF 
payments conferred a benefit on biodiesel producers and in particular because the 
 
1 Commission Implementing Regulation (EU) 2019/2092 of 28 November 2019 imposing a definitive 
countervailing duty on imports of biodiesel originating in Indonesia, Official Journal of the European Union, L 
317, p. 42 -95, dated 9 December 2019.  
2 Commission Implementing Regulation (EU) 2019/1344 of 12 August 2019 imposing a provisional 
countervailing duty on imports of biodiesel originating in Indonesia, Official Journal of the European Union, L 
212, p. 1 -52, dated 13 August 2023.  WT/DS 618/1 • G/L/1 486 • G/SCM/D13 6/1 
 
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  EU selected a wrong counterfactual to analyse the situation of the re cipient on the 
marketplace, absent the financial contribution; wrongly concluded that absent the 
OPPF payments, the biodiesel reference price would be lower; failed to consider the 
export levies paid by biodiesel producers; and failed to consider that the benefit, if 
any, was passed through to biodiesel blenders;  
(d) Articles 19.1, 19.4 and 21.1 of the SCM Agreement, Article VI:3 and Article XVI:1 of 
the GATT 1994 because the EU failed to properly allocate the alleged subsidy 
amounts resulting from OPPF pay ments and thus failed  to accurately determine the 
per unit subsidy amount and to impose countervailing duties at the level not 
exceeding that amount;  
(e) Articles 1.1(a)(1)(ii), 14, 19.3, 19.4 and 32.1 of the SCM Agreement and Article VI:3 
of the GATT 1994  because the EU failed to adjust the amount of the alleged subsidy 
to account for discounts granted as well as export levies, transport and credit costs 
and thus failed to adequately explain its benefit calculation method,  to ascertain as 
accurately as po ssible the amount of subsidization bestowed on the investigated 
products and to levy countervailing duties in the appropriate amounts;  
(f) Articles 1.2, 2.1 and 2.4 of the SCM Agreement because the EU determined that 
through a set of measures the Governmen t of Indonesia provided support to the 
biodiesel industry including through direct transfer of funds via the ‘Biodiesel Subsidy 
Fund’ conferring a benefit to the recipients which is de jure  and de facto  specific;  
(g) Articles 22.3, 22.4 and 22.5 of the SCM  Agreement because on multiple occasions 
throughout its analysis of OPPF payments the EU failed to adequately state the 
reasons on which its conclusions are based and failed to provide sufficient 
explanations why certain claims made by interested parties w ere rejected.  
2. DETERMINATIONS CONCERNING THE ALLEGED GOVERNMENT SUPPORT FOR THE 
PROVISION OF CRUDE PALM OIL ("CPO")  
(a) Article 1.1(a)(1)(iv) of the SCM Agreement because the EU determined that the 
provision of CPO located on Indonesian soil to the Indonesian biodiesel industry is a 
function which is normally vested in the government;  
(b) Article 1.1(a)(1)(iv) of the SCM Agreement because the EU determined that through 
a set of measures, including the export taxes and levy, and by de facto  acting as a 
price setter on the market the Government of Indonesia 'induced' the domestic CPO 
producers to sell CPO locally and 'entrusted' or 'directed' them to provide CPO to 
biodiesel producers in Indonesia for less than adequate remuneration;   
(c) Article 1.1(b)  and Article 14(d) of the SCM Agreement because the EU disregarded, 
without a reasoned and adequate explanation, domestic prices for CPO in Indonesia; 
selected a benchmark that neither reflects the prevailing market conditions in 
Indonesia, nor the conditi ons pursuant to which the goods or services at issue would, 
under market conditions, be exchanged in Indonesia; and thus determined that CPO 
suppliers and producers provided CPO for less than adequate remuneration resulting 
in a benefit being conferred;  
(d) Articles 12.7 and 12.11 of the SCM Agreement because the EU decided to resort to 
facts available with regard to PT Perkebunan Nusantara ("PTPN") as well as with 
regard to all producers and distributors of CPO based, in particular, on PTPN’s alleged 
non-cooperation and because the EU established facts available in a way that did 
not reasonably replace the allegedly missing information;  
(e) Articles 1.1(a)(2) and 32.1 of the SCM Agreement and Article XVI:1 of the GATT 
1994 because the EU determined that the  Government of Indonesia put in place a 
set of measures, including direct subsidies to CPO producers, in order to intervene 
in the market ensuring a particular result, i.e. that the biodiesel producers benefit WT/DS 618/1 • G/L/1 486 • G/SCM/D13 6/1 
 
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  from artificially low prices for CPO and that through that set of measures, the 
Government of Indonesia provides income or price support to the biodiesel industry;  
(f) Articles 1.2, 2.1 and 2.4 of the SCM Agreement because the EU determined that the 
provision of CPO and provision of income or price su pport to the biodiesel industry 
are specific.  
(g) Articles 22.3, 22.4 and 22.5 of the SCM Agreement because on multiple occasions 
throughout its analysis of alleged provision of CPO and income or price support to 
the biodiesel industry the EU failed to ade quately state the reasons on which its 
conclusions are based and by failing to provide sufficient explanations why certain 
claims made by interested parties were rejected.  
3. DETERMINATIONS CONCERNING THE EXISTENCE OF A THREAT OF MATERIAL 
INJURY AND A CAUS AL LINK  
(a) Articles 15.1 and 15.2 of the SCM Agreement because the EU failed to ensure price 
comparability when examining the effect of imports from Indonesia on the prices of 
domestic like products, failed to establish price undercutting for the product as a 
whole and thus failed to establish the existence of significant price undercutting by 
means of Indonesian imports;  
(b) Articles 15.1 and 15.2 of the SCM Agreement because the EU failed to make an 
objective examination, on the basis of positive evidenc e, of the effect of the allegedly 
subsidized imports on prices of EU producers, and thus improperly found significant 
price undercutting and price depression;  
(c) Articles 15.1, 15.4, 15.7 and 15.8 of the SCM Agreement because the EU failed to 
make an obj ective examination, on the basis of positive evidence, of a threat of 
injury and of a fragile economic condition of its domestic industry, in particular by 
failing to make an objective examination, on the basis of positive evidence, of the 
factors having a  bearing on the state of the domestic industry, including those listed 
in Articles 15.4 and 15.7 of the SCM Agreement;  
(d) Articles 15.1, 15.4, 15.7 and 15.8 of the SCM Agreement because the EU failed to 
make an objective examination, on the basis of posit ive evidence, of the nature of 
the subsidies in question and the trade effects likely to arise therefrom;  
(e) Articles 15.1, 15.4, 15.7 and 15.8 of the SCM Agreement because the EU failed to 
make an objective examination, on the basis of positive evidence,  of whether 
Indonesian imports were entering the EU at prices that will have a significant 
depressing or suppressing effect on domestic prices, and would likely increase 
demand for further imports;  
(f) Articles 15.1, 15.4, 15.7 and 15.8 of the SCM Agreemen t because the EU failed to 
make an objective examination, on the basis of positive evidence, of a rate of 
increase of Indonesian imports into the EU market indicating the likelihood of 
substantially increased importation;  
(g) Articles 15.1, 15.4, 15.7 and 15.8 of the SCM Agreement because the EU failed to 
make an objective examination, on the basis of positive evidence, of freely 
disposable production capacity in Indonesia and because the EU improperly 
determined that Indonesian producers are likely to dire ct their spare capacities to 
the Union market, causing further injury to the Union industry;  
(h) Articles 15.1, 15.2, 15.5 and 15.7 of the SCM Agreement because the EU failed to 
make an objective examination, on the basis of positive evidence, of the volum e of 
allegedly subsidized imports from Indonesia, in particular, by disregarding the fact 
that there was no correlation between the evolution of Indonesian imports and the 
evolution of the Union industry's market shares or profitability, either during or a fter 
the period under consideration;  WT/DS 618/1 • G/L/1 486 • G/SCM/D13 6/1 
 
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  (i) Articles 15.1, 15.5, 15.7 and 15.8 of the SCM Agreement because the EU failed to 
make an objective examination, on the basis of positive evidence, that allegedly 
subsidized imports are, through the effects of subsid ization, threatening to cause 
injury to the domestic industry; and because the EU failed to ensure that the threat 
of injury caused to the domestic industry by other factors, such as imports from 
Argentina, was not attributed to allegedly subsidized import s; 
(j) Articles 12.1, 12.3 and 15.1 of the SCM Agreement because the EU failed to provide 
the necessary information to interested parties, including necessary information to 
propose alternative methodologies to determine the existence of price undercutting 
and because the EU provided a late disclosure of essential information concerning, 
among others, price elasticity and changes in the Union market;  
(k) Articles 12.1, 12.3, 12.4 and 12.4.1 of the SCM Agreement because the EU failed to 
provide a  meaningful non -confidential summary of the EU producers' responses to 
the post -investigation period questionnaire;  
(l) Articles 15.1, 15.8, 22.3, 22.4 and 22.5 of the SCM Agreement because the EU based 
its threat of injury determination on information pro vided by one interested party, 
the European Biodiesel Board ("EBB"), while disregarding contradictory information 
provided by the Government of Indonesia and Indonesian exporters;  
(m) Articles 12.3, 22.3, 22.4 and 22.5 of the SCM Agreement because in its t hreat of 
injury determination the EU provided explanations for some trends concerning the 
Union industry's profitability, when they supported its conclusion of a threat of injury 
while ignoring other trends that did not support this conclusion and because the EU 
failed to explain why arguments made by interested parties in this regard were 
rejected.  
4. REJECTION OF A PRICE UNDERTAKING OFFER  
(a) Articles 15.8, 18.3, and 19.3 of the SCM Agreement and Articles I:1 and VI of the 
GATT 1994 because the EU conside red that the monitoring of the undertaking 
offered by an Indonesian exporting producer to be impracticable and unworkable 
and because the EU rejected such offer while accepting it from Argentinean exporting 
producers, thus treating imports of the same prod uct from different WTO Members 
differently.  
As a result of these inconsistencies, the EU's measures also appear to nullify or impair the benefits 
accruing to Indonesia, directly or indirectly, under the covered agreements.  
The Government of Indonesia reser ves the right to raise additional factual and legal issues during 
the course of the consultations and in any request for the establishment of a Panel, in light of the 
information the European Union may provide.  
This consultation request relates to the coun tervailing measures at issue and to any amendments, 
re-opening or extensions of such measures.  
The Government of Indonesia looks forward to receiving a reply of the European Union to this 
Request, and is ready to consider with the European Union a mutually  convenient date for 
consultations.  
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