WT/DS480/R  
 
25 January 2018  
(18-0588) Page: 1/68 
    
 
  
EUROPEAN UNION – ANTI -DUMPING MEASURES ON BIODIESEL  
FROM INDONESIA  
REPORT OF THE PANEL  
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  TABLE OF CONTENTS  
 
1   INTRODUCTION  ................................ ................................ ................................ ..........  8 
1.1   Complaint by Indonesia  ................................ ................................ ................................  8 
1.2   Panel establishment and composition  ................................ ................................ .............  8 
1.3   Panel proceedings  ................................ ................................ ................................ ........  8 
1.3.1    General  ................................ ................................ ................................ ...................  8 
1.3.2    Request for a ruling on third party access to BCI pursuant to the Panel's Additional 
Working Procedures on Business Confidential Information (BCI)  ................................ ...............  9 
1.3.3    Requests for enhanced third party rights by Russia and the European Union  ....................  9 
2   FACTUAL ASPECTS ................................ ................................ ................................ ....... 9 
3   PARTIE S' REQUESTS FOR FIND INGS AND RECOMMENDAT IONS  ................................  11 
4   ARGUMENTS OF THE PAR TIES  ................................ ................................ ...................  12 
5   ARGUMENTS OF THE THI RD PARTIES  ................................ ................................ ........  12 
6   INTERIM REVIEW  ................................ ................................ ................................ ...... 12 
7   FINDIN GS ................................ ................................ ................................ .................  12 
7.1   Introduction  ................................ ................................ ................................ ............... 12 
7.2   General principles regarding treaty interpretation, the applicable standard of review, 
and burden of proof  ................................ ................................ ................................ ........... 13 
7.2.1    Treaty interpretation  ................................ ................................ ................................ 13 
7.2.2    Standard of review ................................ ................................ ................................ ...13 
7.2.3    Burden of proof  ................................ ................................ ................................ .......14 
7.3   Whether the EU anti-dumping measures imposed on imports of biodiesel from 
Indonesia are inconsistent with Articles 2.2 and 2.2.1.1 of the Anti -Dumping Agreement 
and Article VI:1(b)(ii) of the GATT 1994  ................................ ................................ ............... 14 
7.3.1    Introduction  ................................ ................................ ................................ ............ 14 
7.3.2    The EU authorities' determination of t he cost of production for the construction of 
normal value for Indonesian biodiesel producers  ................................ ................................ ....15 
7.3.3    Whether the European Uni on acted inconsistently with Articles 2.2.1.1 and 2.2 of 
the Anti -Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994, by failing to 
calculate the cost of production of biodiesel on the basis of the records kept by the 
producers  ................................ ................................ ................................ ......................... 16 
7.3.4    Whether the European Union acted inconsistently with Article 2.2 of the 
Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 by  failing to construct 
the normal value on the basis of the cost of production in the country of origin  ......................... 19 
7.3.5    Conclusions  ................................ ................................ ................................ ............. 21 
7.4   Whether the European Union established an amount for profits inconsistently with 
Articles 2.2 and 2.2.2(iii) of the Anti -Dumping Agreement ................................ ....................... 21 
7.4.1    Introduction  ................................ ................................ ................................ ............ 21 
7.4.2    The EU authorities' determination of an amount for profits for Indonesian biodiesel 
producers  ................................ ................................ ................................ ......................... 21 
7.4.3    Whether the European Union acted inconsistently with Articles 2.2 and 2.2.2(iii) of 
the Anti -Dumping Agreement by failing to calculate a profit cap and ensure that the profit 
margin established for each Indonesian exporter did not  exceed that cap  ................................ .24 WT/DS480/R  
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  7.4.4    Whether the European Union determined a profit margin for Indonesian producers 
on the basis of a "reasona ble method" within the meaning of Article 2.2.2(iii) of the Anti -
Dumping Agreement  ................................ ................................ ................................ .......... 31 
7.4.5    Conclusions  ................................ ................................ ................................ ............. 39 
7.5   Whether the European Union constructed the export price inconsistently with 
Articles 2.3 and 2.4 of the Anti -Dumping Agreement  ................................ .............................. 39 
7.5.1    Introduction  ................................ ................................ ................................ ............ 39 
7.5.2    The EU authorities' construction of the export price for P.T. Musim Mas  .......................... 40 
7.5.3    Whether the European Union properly excluded the double counting premium 
from the price at which the imported biodiesel was first resold to independent buyers in 
the European Union  ................................ ................................ ................................ ............ 41 
7.5.4    Conclusions  ................................ ................................ ................................ ............. 44 
7.6   Whether the European Union's consideration of price effects was consistent with 
Articles 3.1 and 3.2 of the Anti -Dumping Agreement  ................................ .............................. 44 
7.6.1    Introduction  ................................ ................................ ................................ ............ 44 
7.6.2    The EU authorities' consideration of the effect of dumped imports on the price of 
biodiesel sold in the domestic market  ................................ ................................ ................... 44 
7.6.3    Whether the adjustment made by the EU authorities to the price of imports of 
Indonesian biodiesel was flawed  ................................ ................................ .......................... 46 
7.6.4    Whether the EU authorities failed to take into account noticeable differ ences 
between imported and domestic biodiesel and to examine the significance of price 
undercutting with regard to the majority of the EU industry's sales  ................................ .......... 51 
7.6.5    Conclusions  ................................ ................................ ................................ ............. 56 
7.7   Whether the European Union acted inconsistently with Article 9.3 of the 
Anti-Dumping Agreement and Article VI:2 of the GATT 1994 by imposing and levying 
anti-dumping duties in excess of the margins of dumping  ................................ ....................... 56 
7.7.1    Introduction  ................................ ................................ ................................ ............ 56 
7.7.2    The EU authorities' imposition of definitive anti -dumping duties  ................................ .....57 
7.7.3    Whether Indonesia has established that the European Union acted inconsistently 
with Article 9.3 of the Anti -Dumping Agreement and Article VI:2  of the GATT 1994  .................... 57 
7.7.4    Conclusions  ................................ ................................ ................................ ............. 59 
7.8   Whether the European Union acted inconsistently with Articles 7 and 9 of the 
Anti-Dumping Agreement through the application and definitive collection of  provisional 
anti-dumping duties  ................................ ................................ ................................ ........... 59 
7.8.1    Introduction  ................................ ................................ ................................ ............ 59 
7.8.2    The EU authorities' determination of a provisional margin of dumping for 
P.T. Musim Mas and the definitive collection of provisional duties  ................................ ............. 60 
7.8.3    Whether Indonesia has established violations of Articles 7 and 9 of the 
Anti-Dumping Agreement related to the definitive collection of provisional anti -dumping 
duties on imports from P.T. Musim Mas  ................................ ................................ ................ 61 
7.8.4    Conclusions  ................................ ................................ ................................ ............. 66 
8   CONCLUSIONS AND RECO MMENDATION  ................................ ................................ ... 67 
 
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  LIST OF ANNEXES  
 
ANNEX A  
WORKING PROCEDURES O F THE PANEL  
Contents  Page  
Annex A -1 Working Procedures of the Panel  A-2 
Annex  A-2 Additional Working Procedures on Business Confidential Information  A-7 
ANNEX B  
ARGUMENTS OF THE PAR TIES 
Contents  Page  
Annex B -1 First executive summary of the arguments of Indonesia  B-2 
Annex  B-2 Second executive summary of the arguments of Indonesia  B-13 
Annex  B-3 First executive summary of the arguments of the European Union  B-26 
Annex  B-4 Second executive summary of the arguments of the European Union  B-36 
ANNEX C  
ARGUMENTS OF THE THI RD PARTIES  
Contents  Page  
Annex C-1 Executive summary of the arguments of Argentina  C-2 
Annex C-2 Executive summary of the arguments of Australia  C-6 
Annex C-3 Executive summary of the arguments of Brazil  C-9 
Annex C-4 Executive summary of the arguments of China  C-12 
Annex C-5 Executive summary of the arguments of Japan  C-14 
Annex C-6 Executive summary of the arguments of Norway  C-18 
Annex C-7 Executive summary of the arguments of Russia  C-20 
Annex C-8 Executive summary of the arguments of Turkey  C-24 
Annex C-9 Executive summary of the arguments of the United States  C-27 
ANNEX D  
PROCEDURAL RULINGS O F THE PANEL  
Contents  Page  
Annex  D-1 Decision of the Panel concerning Indonesia's request to limit third party access 
to specific Business Confidential Information (BCI)  D-2 
Annex  D-2 Decision of the Panel concerning requests by Russia and the European Union 
for enhanced third party rights  D-3 WT/DS480/R  
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  CASES CITED IN THIS REPORT  
Short title  Full case title and citation  
Canada – Autos  Appellate Body Report, Canada – Certain Measures Affecting the Automotive 
Industry , WT/DS139/AB/R , WT/DS142/AB/R , adopted 19 June 2000, 
DSR 2000:VI, p. 2985  
Canada – Welded Pipe  Panel Report, Canada – Anti-Dumping Measures on Impor ts of Certain 
Carbon Steel Welded Pipe from the Separate Customs Territory of Taiwan, 
Penghu, Kinmen and Matsu , WT/DS482/R  and Add.1, adopted 
25 January  2017 
China – Broiler Products  Panel Report, China  Anti-Dumping and Countervailing Duty Measures on 
Broiler Products from the United States , WT/DS427/R  and Add.1, adopted 
25 September 2013, DSR 2013:IV, p. 1041  
China – Cellulose Pulp  Panel Report, China – Anti-Dumping Measures on Imports of Cellulose Pulp 
from Canada , WT/DS483/R  and Add.1, adopted 22 May 2017  
China – GOES  Appellate Body Report, China – Countervailing and Anti -Dumping Duties on 
Grain Oriented Flat -Rolled Electrical Steel from the United States , 
WT/DS414/AB/R , adopted 16 November 2012, DSR 2012:XII, p. 6251  
China – HP-SSST (Japan) / 
China – HP-SSST (EU)  Appellate Body Reports, China – Measures Imposing Anti -Dumping Duties on 
High-Performance Stainless Steel Seamless Tubes ("HP -SSST") from Japan / 
China – Measures Imposing Anti -Dumping Duties on High -Performance 
Stainless Steel Seamless Tubes ("HP -SSST") from the European Union , 
WT/DS454/AB/R  and Add.1 / WT/DS460/AB/R  and Add.1, adopted 
28 October 2015  
China – HP-SSST (Japan) / 
China – HP-SSST (EU)  Panel Reports, China – Measures Imposing Anti -Dumping Duties on High -
Performance Stainless Steel Seamless Tubes ("HP -SSST") from Japan / 
China – Measures Imposing Anti -Dumping Duties on High -Performance 
Stainless Steel Seamless Tubes ("HP -SSST") from the European Union , 
WT/DS454/R  and Add.1 / WT/DS460/R , Add.1 and Corr.1, adopted 
28 October 2015, as modified by Appellate Body Reports WT/DS454/AB/R -
WT/DS460/AB/R  
China – X-Ray Equipment  Panel Report,  China – Definitive Anti -Dumping Duties on X -Ray Security 
Inspection Equipment from the European Union , WT/DS425/R  and Add.1, 
adopted 24 April 2013, DSR 2013:III, p. 659  
EC – Bed Linen  Panel Report, European Communities – Anti-Dumping Duties on Imports of 
Cotton -Type Bed Linen from India , WT/DS141/R , adopted 12 March 2001, as 
modified by Appellate Body Report WT/DS141/AB/R, DSR  2001:VI, p.  2077 
EC – Fasteners (China)  Panel Report, European Communities – Definitive Anti -Dumping Measures on 
Certain Iron or Steel Fasteners from China , WT/DS397/R  and Corr.1, 
adopted 28 July 2011, as modified by Appellate Body Re port 
WT/DS397/AB/R, DSR 2011:VIII, p. 4289  
EC – Hormones  Appellate Body Report, EC Measures Concerning Meat and Meat Products 
(Hormones) , WT/DS26/AB/R , WT/DS48/AB/R , adopted 13 February 1998, 
DSR 1998:I, p. 135  
EC – Salmon (Norway)  Panel Report, European Communities – Anti-Dumping Measure on Farmed 
Salmon from Norway , WT/DS337/R , adopted 15 January 2008, and Corr.1, 
DSR 2008:I, p. 3  
EU – Biodiesel (Argentina)  Appellate Body Report, European Union – Anti-Dumping Measures on 
Biodiesel from Argentina , WT/DS473/AB/R  and Add.1, adopted 
26 October  2016 
EU – Biodiesel (Argentina)  Panel Report, European Union – Anti-Dumping Measures on Biodiesel from 
Argentina , WT/DS473/R  and Add.1, adopted 26 October 2016, as modified 
by Appellate Body Report WT/DS473/AB/R  
EU – Footwear (China)  Panel Report, European Union – Anti-Dumping Measures on Certain Footwear 
from China , WT/DS405/R , adopted 22 February 2012, DSR 2012:IX, p. 4585  
Japan – Alcoholic Beverages II  Appellate Body Report, Japan – Taxes on Alcoholic Beverages , 
WT/DS8/AB/R , WT/DS10/AB/R , WT/DS11/AB/R , adopted 1 November 1996, 
DSR 1996:I, p. 97  WT/DS480/R  
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  Short title  Full case title and citation  
Thailand – H-Beams  Panel Report, Thailand – Anti-Dumping Duties on Angles, Shapes and 
Sections of Iron or Non -Alloy Steel and H -Beams from Poland , WT/DS122/R , 
adopted 5 April 2001, as modified by Appellate Body Report 
WT/DS122/AB/R, DSR 2001:VII, p. 2741  
US – Anti-Dumping and 
Countervailing Duties (China)  Appellate Body Report, United States – Definitive Anti -Dumping and 
Countervailing Duties  on Certain Products from China , WT/DS379/AB/R , 
adopted 25 March 2011, DS R 2011:V, p. 2869  
US – Carbon Steel (India)  Appellate Body Report, United States – Countervailing Measures on Certain 
Hot-Rolled Carbon Steel Flat Products from India , WT/DS436/AB/R, adopted 
19 December 2014, DSR 2014:V, p. 1727  
US – Continued Zeroing  Appellate Body Report, United States – Continued Existence and Application 
of Zeroing Methodology , WT/DS350/AB/R , adopted 19 February 2009, 
DSR 2009:III, p. 1291  
US – Countervailing Duty 
Investigation on DRAMS  Appellate Body Report, United States – Countervailing Duty Investigation on 
Dynamic Random Access Memory Semiconductor s (DRAMS) from Korea , 
WT/DS296/AB/R , adopted 20 July 2005, DSR 2005:XVI, p. 8131  
US – Hot-Rolled Steel  Appellate Body Report, United States – Anti-Dumping Measures on Certain 
Hot-Rolled Steel Products from Japan , WT/DS184/AB/R , adopted 
23 August  2001, DSR 2001:X, p. 4697  
US – Lamb  Appel late Body Report, United States – Safeguard Measures on Imports of 
Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia , 
WT/DS177/AB/R , WT/DS178/AB/R , adopt ed 16 May 2001, DSR 2001:IX, 
p. 4051 
US – Oil Country Tubular 
Goods Sunset Reviews  Appellate Body Report, United States – Sunset Reviews of Anti -Dumping 
Measures on Oil Country Tubular Goods from Argentina , WT/DS268/AB/R , 
adopted 17 December 2004, DSR 2004:VII, p. 3257  
US – Shrimp (Article 21.5 – 
Malaysia)  Appellate Body Report, United States – Import Prohibition of Certain Shrimp 
and Shrimp Products – Recourse to Article 21.5 of the DSU by Malaysia , 
WT/DS58/AB/RW , adopted 21 November 2001, DSR 2001:XIII, p. 6481  
US – Softwood Lumber VI 
(Article 21.5 – Canada)  Appellate Body Report, United States – Investigation of the  International 
Trade Commission in Softwood Lumber fr om Canada – Recourse to 
Article  21.5 of the DSU by Canada , WT/DS277/AB/RW , adopted 9 May 2006, 
and Corr.1, DSR 2006:XI, p. 4865  
US – Stainless Steel (Korea)  Panel Report, United States – Anti-Dumping Measures on Stainless Steel 
Plate in Coils and Stainless Steel Sheet and Strip from Korea , WT/DS179/R , 
adopted 1 February 2001, DSR 2001:IV, p. 1295  
US – Stainless Steel (Mexico)  Appellate Body Report, United States – Final Anti -Dumping Measures on 
Stainless Steel from Mexico , WT/DS344/AB/R , adopted 20 May 2008, 
DSR 2008:II, p. 513  
US – Wool Shirts a nd Blouses  Appellate Body Report, United States – Measure Affecting Imports of Woven 
Wool Shirts and Blouses from India , WT/DS33/AB/R , adopted 23 May 1997, 
and Corr.1, DSR 1997:I, p. 323  
US – Zeroing (EC)  Appellate Body Report, United States – Laws, Regulations and Methodology 
for Calculating Dumping Margins ("Zeroing") , WT/DS294/AB/R , adopted 
9 May 2006, and Corr.1, DSR 2006:II, p. 417  
 
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  ABBREVIATIONS USED I N THIS REPORT  
Abbreviation  Description  
Anti-Dumping Agreement  Agreement on Implementation of Article VI of the General Agreement on Tariffs 
and Trade 1994  
CFPP Cold filter plugging point  
CIF Cost, insurance, and freight  
CPO Crude palm oil  
DET Differential Export Tax  
DSB Dispute Settlement Body  
DSU Understanding on Rules and Procedures Governing the Settlement of Disputes  
EBB European Biodiesel Board  
EU Basic Regulation  Council Regulation (EC) No. 1225/2009 of 30 November 2009  on protection  
against dumped imports from countries not members of the European  
Community (codified version), OJ L 343, 22.12.2009, and corrigendum to  
Council Regulation (EC) No. 1225/2009, OJ L 7, 12.1.2010  
FOB Free on board  
GATT 1994  General Agreement  on Tariffs and Trade 1994  
HPE Reference price that is published monthly by the Indonesian Authorities and is 
based on the average price from the previous month from three sources, 
i.e. CIF Rotterdam, CIF Malaysia,  and the Indonesian commodity exchange 
market, all brought back to the FOB level  
PFAD Palm fatty acid distillate  
PME Palm methyl ester  
RME Rapeseed methyl ester  
SG&A  Selling, general, and administrative  
SME Soybean methyl ester  
USD US dollars  
Vienna Convention  Vienna Convention on the Law of Treaties, Done at Vienna, 23 May 1969, 
1155 UNTS 331; 8 International Legal Materials 679  
Wilmar Group  P.T. Wilmar Bioenergi and P.T. Wilmar Nabati  
WTO World Trade Organization  
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  1  INTRODUCTION  
1.1  Complaint by Indonesia  
1.1.  On 10 June 2014, Indonesia requested consultations with the European Union pursuant to 
Articles 1 and 4 of the Understanding on Rules and Procedures Governing the Settlement of 
Disputes (DSU), Article XXII:1 of the General Agreement on Tariffs and Trade 19 94 (GATT 1994) 
and Articles 17.2 and 17.3 of the Agreement on Implementation of Article VI of the General 
Agreement on Tariffs and Trade 1994 (Anti -Dumping Agreement) with respect to the anti -dumping 
measures imposed by the European Union on imports of bio diesel originating in, inter alia , 
Indonesia.1 
1.2.  Consultations were held on 23 July 2014 but failed to resolve the dispute.  
1.2  Panel establishment and composition  
1.3.  On 30 June 2015, Indonesia requested the establishment of a panel pursuant to Article  6 of 
the DSU  with standard terms of reference.2 At its meeting on 31 August 2015, the Dispute 
Settlement Body (DSB) established a panel pursuant to the request of Indonesia in documents 
WT/DS 480/2 and WT/DS480/2/Corr.1 , in accordance with Article  6 of the DSU.3 
1.4.  The Pa nel's terms of reference are the following:  
To examine, in the light of the relevant provisions of the covered agreements cited by 
the parties to the dispute, the matter referred to the DSB by Indonesia in documents 
WT/DS480/2 and WT/DS480/2/Corr.1 and to make such findings as will assist the 
DSB in making the recommendations or in giving the rulings provided for in those 
agreements.4 
1.5.  On 4 November 2015, the parties agreed that the panel would be composed as follows:  
Chairperson:  Ms Deborah Milstein  
 
Member s:  Mr Gilles Le Blanc  
   Mr Mathias Francke  
 
1.6.  Argentina, Australia, Brazil, Canada, China, India, Japan, Norway, the Russian Federation, 
Singapore, Turkey, Ukraine,  and the United States notified their interest in participating in the 
Panel proceedings as third parties.  
1.3  Panel proceedings  
1.3.1   General  
1.7.  The Panel began its work on this case later than it would have wished due to staff constraints 
in the WTO Secretariat.5 The Panel held its organizational meeting with the parties on 4 May 201 6. 
During this meeting, Indonesia requested to postpone the proceedings pending the possible appeal 
of the panel report in EU – Biodiesel (Argentina) .6, 7 The European Union did not object to 
Indonesia's request. On 3 June 2016, the Panel decided to grant I ndonesia's request and delay the 
proceedings until the Appellate Body Report in EU – Biodiesel (Argentina)  had been circulated.  
                                                
1 Request for consultations by Indonesia, WT/DS480/1  (Indonesia's consultations request) . 
2 Request for the establishment of a panel by Indonesia, WT/DS480/2 (Indonesia's panel request) . 
3 DSB, Minutes of the meeting held on 31 August 2015, WT/DSB/M/367 . 
4 Constitution note of the Panel, WT/DS480/3 . 
5 EU – Biodiesel (Indonesia) , communication from the Panel (dat ed 15 April 2016, circulated 
22 April 2016), WT/DS480/4.  
6 Indonesia further clarified its request in its communication dated 13 May 2016.  
7 The Panel Report in EU – Biodiesel (Argentina)  was appealed by  the European Union on 20 May 2016 . 
(Notification of an Appeal by the European Union, WT/DS473/10 (dated 20 Ma y 2016 and circulated on 
26 May 2016) and by Argentina on 25 May 2016 . (Notification of an Other Appeal by Argentina, WT/DS473/11 
(dated 25 May 2016 and circulated on 31 May 2016) ). WT/DS480/R  
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  1.8.  On 6 October 2016, the Appellate Body circulated its report in EU – Biodiesel (Argentina) , 
which was adopted by the DSB on 26 O ctober 2016. On 4 November 2016, following a 
communication from the Panel requesting clarification8, Indonesia requested the Panel to resume 
its work and hold an additional organizational meeting to consider a proposed timetable and 
working procedures.9 The Panel held its second organizational meeting on 30 November 2016. 
After consultation with the parties, the Panel adopted its Working Procedures10, Additional Working 
Procedures on Business Confidential Information (BCI)11, and timetable on 13 December 2016 . 
1.9.  The Panel held a first substantive meeting with the parties on 29 -30 March 2017. A session 
with the third parties took place on 30 March 2017. The Panel held a second substantive meeting 
with the parties on 4 -5 July 2017. On  1 September 2017 , the Panel i ssued the descriptive part of 
its Report to the parties. The Panel issued its Interim Report to the parties on  3 October 2017 . The 
Panel issued its Final Report to the parties on  26 October 2017 . 
1.3.2   Request for a ruling on third party access to BCI pursuant t o the Panel's 
Additional Working Procedures on Business Confidential Information (BCI)  
1.10.   On 6 January 2017,  the Panel received a communication from Indonesia, requesting the 
Panel to limit third -party access to certain company specific data provided by individual Indonesian 
producers, pursuant to paragraph 6 of the  Panel's  adopted Additional Working Procedures  on 
Business Confidential Information .12 On 12 January 2017, the European Union objected to the 
request, s ubmitting that Indonesia's request is inconsistent with the DSU and fails to comply with 
the terms of paragraph 6 of the Additional BCI Procedures.13 On 17  January 2017, the Panel 
informed the parties and the third parties that it had denied Indonesia's req uest to limit third -party 
access to certain BCI. The Panel's decision is set out in Annex D -1.  
1.3.3   Requests for enhanced third party rights by Russia and the European Union  
1.11.   On 12 December 2016, Russia requested the Panel to exerci se its discretion under 
Article 12.1 of the DSU to modify its Working Procedures and grant enhanced third party rights in 
this proceeding.14 On 13 January 2017, the European Union requested the Panel to grant Russia's 
request, albeit for different reasons than those contained in Russia 's request .15 On 2 March 2017, 
the Panel informed the parties and the third parties that it had rejected those requests by Russia 
and the European Union. The Panel's decision is set out in Annex D -2. 
2  FACTUAL ASPECTS  
2.1.  This dispute concerns the anti -dumping me asure s imposed by the European Union on imports 
of biodiesel from Indonesia that w ere adopted following the conclusion of an investigation on 
imports of biodiesel from Argentina and Indonesia.16 This investigation was previously the subject 
                                                
8 Communication from the Panel dated 28 October 2016 . 
9 In a communication dated 9 November 2016, the European Union informed the Panel that it 
considered that outstanding developments may have a direct b earing on the question of whether or not it is 
necessary, appropriate or fruitful to continue with the present proceedings at this time . Specifically, the 
European Union referred to the fact that at that time it had yet to inform the DSB of its intentions in respect of 
implementation of the recommendations and rulings of the DSB. In addition, the European Union stated that 
the measure at issue had been substantially annulled by the municipal courts of the European Union, and 
expected that a pending appeal r elated to this annulment would be concluded within a reasonable period of 
time. In a communication dated 11 November 2016, Indonesia confirmed that it wished to proceed with the 
dispute in the absence of any objective changes in factual circumstances.  
10 See the Panel's Working Procedures in Annex A -1. 
11 Additional Working Procedures of the Panel on Business Confidential Information, Annex A -2. 
12 Communication from Indonesia dated 6 January 2017, 03/ITN/I/2017.  
13 Communication from the European Union dated 12 January 2017.  
14 Communication from Russia dated 12 December 2016.  
15 Communication from the European Union dated 13 January 2017.  
16 Commission Regulation (EU) No . 490/2013 of 27 May 2013 imposing a provisional anti -dumping duty 
on imports of biodiesel or iginating in Argentina and Indonesia, OJ L 141, 28.5.2013 (Provisional Regulation), 
(Exhibit IDN -1), p. 6 ; Council Implementing Regulation (EU) No . 1194/2013 of 19 November 2013 imposing a 
definitive anti -dumping duty and collecting definitively the provisional duty imposed on imports of biodiesel 
originating in Argentina and Indones ia, OJ L 315, 26.11.2013 ( Definitive Regulation) , (Exhibit IDN -2), p. 2. WT/DS480/R  
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  of the dispute EU – Biodiesel  concerning a complaint by Argentina , in respect of imports of 
biodiesel from Argentina .17  
2.2.  The investigation was initiated by the European Commission on 29 August 201218 following a 
complaint submitted by the European Biodiesel Board (EBB).19 The EU authorities20 imposed 
provisional anti -dumping duties on 29 May 201321 and defin itive anti -dumping duties on 
27 November 2013.22 Provisional anti -dumping duties were applied ranging from zero to 9.6%23 
and were subsequently definitively collected on 2 7 November 2013.24 Definitive dumping margins 
were calculated ranging from 8.8% to 23.3% and definitive anti -dumping duties were applied 
corresponding to the calculated injury margins, which ranged from 8.8% to 20.5%.25 The duties 
were applied in the form of specific duties expressed as a fixed amount in euro/tonne.  
2.3.  On 20 December  2016, the European Commission initiated a review of the anti -dumping 
measures imposed on imports of biodiesel originating in Argentina to bring them into conformity 
with the recommen dations and rulings adopted by the DSB, following the adoption of the panel 
report, as modified by the Appellate Body report in the EU – Biodiesel (Argentina) dispute.26 In its 
notice of initiation, the European Commission indicated that it also considered it appropriate to 
examine  the anti -dumping measures imposed on imports of biodiesel from Indonesia, considering 
that: (a) the anti -dumping measures imposed on imports of biodi esel from Indonesia are 
subject  to a WTO dispute and involve essentially the same  claims as raised by Argentina in the 
EU – Biodiesel (Argentina)  dispute; and (b) the legal interpretations contained in the adopted 
panel and Appellate Body reports in EU – Biodiesel (Argentina) appear also to be relevant for the 
investigation concerning Indonesia.27  
                                                
17 Panel Report and Appellate Body Report in EU – Biodiesel (Argentina) , WT/DS473/R and 
WT/DS473/AB/R. Argentina challenged certain aspects of the anti -dumping measures that were imposed in 
respect of imports of biodiesel from Argentina. In addition, A rgentina made "as such" claims concerning the 
second subparagraph of Article 2(5) of Council Regulation (EC) No. 1225/2009 of 30 November 2009 on 
protection against dumped imports from countries not members of the European Community. (Panel Report, 
EU – Biodiesel (Argentina) , paras. 2.2 -2.3). 
18 Notice of initiation of an anti -dumping proceeding concerning imports of biodiesel originating in 
Argentina and Indonesia, OJ C 260, 29.8.2012, (Exhibit IDN -4). On 10 November 2012, the EU authorities 
initiated an an ti-subsidy proceeding with regard to imports of biodiesel from A rgentina and Indonesia. 
(Notice  of initiation of an anti -subsidy proceeding concerning imports of biodiesel originating in Argentina and 
Indonesia, OJ C 342, 10.11.2012, (Exhibit IDN -5)). The domestic indus try withdrew its complaint on 
7 October  2013 and the investigation was terminated on 27 November 2013. (Commission Regulation (EU) 
No. 1198/2013 of 25 November 2013 terminating the anti -subsidy proceeding concerning imports of biodiesel 
originating in Argentina and Indonesia and repealing Regulation (EU) No. 330/2013 making such imports 
subject to registration, OJ L 315, 26.11.2013, (Exhibit IDN -6)). 
19 Consolidated version of the new anti -dumping complaint concerning imports of biodiesel origi nating in 
Argentina and Indonesia (Complaint),  (Exhibit IDN -3). 
20 At the time of the investigation, t he European Commission conduct ed investigations and adopt ed 
preliminary determinations; the European Council adopt ed the  final determinations on the basis of proposals 
from the European Commission.  
21 Provisional Regulation , (Exhibit IDN -1). 
22 Definitive Regulation , (Exhibit IDN -2). 
23 Provisional Regulation, (Exhibit IDN -1), recital 179.  
24 Definitive Regulation , (Exhibit IDN -2). 
25 Definitive Regulation, (Exhi bit IDN -2), recital 215. The injury margins for two Indonesian producers 
were determined to be higher than the corresponding dumping margins. Anti -dumping duty rates were 
assessed at the rate of the dumping margins for those producers.  
26 Notice of initiati on regarding the anti -dumping measures in force on imports of biodiesel originating in 
Argentina and Indonesia, following the recommendations and ruling s adopted by the Dispute Settlement Body 
of the World Trade Organization in the EU – Anti-Dumping Measur es on Biodiesel  dispute (DS473) OJ C476/3 
of 20 December 2016, (Exhibit IDN -8). 
27 The European Commission indicated that the scope of the review was limited to the cost of production 
of the product under investigation when constructing normal value and the  production capacity and capacity 
utilisation in the context of establishing the impact of the dumped imports on the domestic industry. (Notice of 
initiation regarding the anti -dumping measures in force on imports of biodiesel originating in Argentina and 
Indonesia, following the recommendations and ruling s adopted by the Dispu te Settlement Body of the 
World  Trade Organization in the EU – Anti-Dumping Measures on Biodiesel dispute  (DS473) OJ C476/3 of 
20 December 2016, (Exhibit IDN -8)). WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  3  PARTIES' REQUESTS FO R FINDINGS AND RECOM MENDATIONS  
3.1.  Indonesia requests that the Panel find that the anti -dumping measures imposed by the 
European Union on imports of biodiesel from Indonesia are inconsistent with28: 
a. Articles 2.2 and 2.2.1.1 of the Anti -Dumping Agreement and Article VI:1(b)(ii) of the 
GATT 1994 because in constructing the normal value for the Indonesian producers under 
investigation, the European Union did not calculate the cost of production of biodiesel on 
the basis of the reco rds kept by those producers even though the records were in 
accordance with the generally accepted accounting principles  and accurately and 
reasonably reflected the actual cost of production of biod iesel, and because the 
European  Union therefore failed to properly calculate the cost of production and properly 
construct the normal value for those producers.  
b. Article 2.2 of the Anti -Dumping Agreement because the European Union failed to 
construct the normal value for the Indonesian producers under investigatio n on the basis 
of the cost of production of biodiesel in the country of origin, i.e. Indonesia.  
c. Articles 2.2 and 2.2.2(iii) of the Anti -Dumping Agreement because when constructing the 
normal value for the Indonesian producers under investigation, the Europ ean Union did 
not establish a cap for the profits as required by Article 2.2.2(iii) and the amount for 
profits established was not determined by the European Union on the basis of a 
reasonable method.  The European Union therefore failed to properly constru ct the 
normal value for those producers.  
d. Articles 2.3 and 2.4 of the Anti -Dumping Agreement because the European Union did not 
construct the export price for one Indonesian producer under investigation on the basis 
of the price at which the imported biodie sel was first resold to independent buyers in the 
European Union.  
e. Article 9.3 ( chapeau ) of the Anti -Dumping Agreement and Article VI:2 of the GATT 1994 
because on account of the inconsistencies with Article 2 specified above in the context of 
the calculati on of the dumping margin for the Indonesian producers, the European Union 
calculated a margin of dumping and imposed and collected anti -dumping duties in excess 
of the actual dumping margin, if any, by the Indonesian producers.  This resulted in the 
levy of  anti-dumping duties on the Indonesian producers that exceeded their margin of 
dumping which, under Article 9.3 of the Anti -Dumping Agreement, operates as the 
ceiling for the amount of anti -dumping duty that can be levied in respect of the sales 
made by a producer/exporter.  
f. Articles 3.1 and 3.2 of the Anti -Dumping Agreement because the European Union's 
determination of injury to the Union industry was not based on an objective examination 
of the effect of those imports on prices in the domestic market for b iodiesel and the 
consequent impact of those allegedly dumped imports on domestic producers of 
biodiesel.  The European Union's findings regarding the price effects of the allegedly 
dumped imports including price undercutting were not based on an objective 
examination of the evidence on the record as, among others, the European Union did not 
ensure price comparability in terms of physical characteristics and model -matching and 
based its determination of price undercutting on partial and unexplained sales of t he 
sampled European Union producers.  
g. Articles 7.1, 7.2, 9.2 , and 9.3 ( chapeau ) of the Anti -Dumping Agreement because the 
European Union incorrectly imposed and definitively collected provisional anti -dumping 
duties with respect to the imports from one Indo nesian producer under investigation, in 
excess of the actual provisional margin of dumping of this producer, as it based itself on 
a provisional dumping margin tainted by calculation errors.  
                                                
28 Indonesia's first written submission, para. 362; second written submission, para. 206.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  3.2.  Indonesia submits that, a s a consequence of the measures imposed by the European Union,  
the benefits accruing to Indonesia under the Anti -dumping Agreement and the GATT 1994 were 
impaired or nullified.  Indonesia considers that the measures at issue should be withdrawn.29 
3.3.  Indonesia requests the Panel to make use of its di scretion under the second sentence of 
Article 19.1 of the DSU by suggesting ways in which the European Union should implement the 
recommendations and rulings of the DSB to bring its measures into conformity with the 
Anti-Dumping Agreement and the GATT 1994.30 
3.4.  The European Union requests that the Panel reject Indonesia's claims in this dispute in their 
entirety.31 
4  ARGUMENTS OF THE PAR TIES  
4.1.  The arguments of the parties are reflected in their executive summaries, provided to the 
Panel in accordance with parag raphs 18 and 19 of the Working Procedures adopted by the Panel 
(see Annexes B -1, B-2, B-3, and B -4). 
5  ARGUMENTS OF THE THI RD PARTIES  
5.1.  The arguments of Argentina, Australia, Brazil, China, Japan, Norway, Russia, Turkey,  and the 
United States are reflected in their executive summaries, provide d in accordance with 
paragraphs  18 and 20 of the Working Procedures adopted by the Panel (see Annexes from C-1 
to C-9). Canada, India, Singapore,  and Ukraine did not submit written or oral arguments to the 
Panel.  
6  INTERIM R EVIEW  
6.1.  On 3 October 2017, the Panel issued its Interim Report to the parties. On 17 October 2017, 
the parties submitted communications to the Panel . Neither party asked the Panel to review  
specific aspects of the Interim Report , nor requested an interim review meeting.  
6.2.  We have made a number of changes of an editorial or formatting nature to correct 
typographical and other non -substantive errors, as well as to reflect the parties' designations of 
information as BCI.  
7  FINDINGS  
7.1  Introduction  
7.1.  Indone sia has advanced claims on an "as applied" basis concerning the anti -dumping 
measures at issue in this case . Indonesia challenges several aspects of the dumping determination  
related to the construction of normal value and export price , certain aspects of the 
European  Union's consideration of price effects and finding of significant price undercutting  made 
in the context of the injury determination , the collection of definitive anti -dumping duties , and 
finally, the decision to impose and definitively collec t provisional anti -dumping duties on imports 
from one Indonesian producer under investigation.  These claims have been brought under a 
number of provisions of the Anti -Dumping Agreement and GATT 1994.  
7.2.  We shall address Indonesia's claims after first  recalling  the general principles governing 
treaty interpretation, the standard of  review , and the burden of proof in WTO dispute settlement 
proceedings . 
                                                
29 Indonesia's first written submission, para. 363; second written submission, para. 207.  
30 Indonesia's first written submission, para. 364; second written submission, para. 208.  
31 European Union's first written submission, para. 149; second written submission, para. 77.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  7.2  General principles regarding treaty interpretation, the applicable standard of 
review , and burden of pr oof 
7.2.1   Treaty interpretation  
7.3.  Article  3.2 of the DSU provides that the dispute settlement system serves to clarify the 
existing provisions of the covered agreements "in accordance with customary rules of 
interpretation of public international law". Article  17.6(ii) of the Anti -Dumping Agreement similarly 
requires panels to interpret that Agreement's provisions in accordance with the customary rules of 
interpretation of public internation al law.32 It is generally accepted that the principles codified in 
Articles  31 and 32 of the Vienna Convention are such customary rules.33 
7.2.2   Standard of review  
7.4.  Panels generally are bound by the standard of review set forth in Article  11 of the DSU, which 
provides, in relevant part, that:  
[A] panel should make an objective assessment  of the matter before it, including an 
objective assessment of the facts of the case and the applicability of and conformity 
with the relevant covered agreements.  
7.5.  In addition, Article  17.6 of the Anti -Dumping Agreement sets forth the special standard of 
review applicable to disputes under the Anti -Dumping Agreement:  
(i) in its assessment of the facts of the matter, the panel shall determine whether 
the authorities' establishment of the facts was proper and whether their evaluation of 
those facts was unbiase d and objective. If the establishment of the facts was proper 
and the evaluation was unbiased and objective, even though the panel might have 
reached a different conclusion, the evaluation shall not be overturned;  
(ii) the panel shall interpret the relevan t provisions of the Agreement in accordance 
with customary rules of interpretation of public international law. Where the panel 
finds that a relevant provision of the Agreement admits of more than one permissible 
interpretation, the panel shall find the au thorities' measure to be in conformity with 
the Agreement if it rests upon one of those permissible interpretations.  
Thus, Article  11 of the DSU and Article  17.6 of the Anti -Dumping Agreement together establish the 
standard of review we are to  apply with respect to both the factual and the legal aspects of the 
present dispute.   
7.6.  When  a panel is reviewing an investigating authority's determination  of facts , the "objective 
assessment" standard in Article  11 of the DSU requires a panel to review whether the au thorities 
have provided a reasoned and adequate explanation as to : (a) how the evidence on the record 
supported its factual findings; and ( b) how those factual findings support the overall 
determination.34 Moreover, with respect to a "reasoned and adequate explanation", the 
Appellate  Body observed : 
What is "adequate " will inevitably depend on the facts and circumstances of the case 
and the particular claims made, but several general lines of inquiry are likely to be 
relevant. The panel's scrutiny should test whether the reasoning of the authority is 
coherent and inter nally consistent. The panel must undertake an in -depth examination 
of whether the explanations given disclose how the investigating authority treated the 
facts and evidence in the record and whether there was positive evidence before it to 
support the infe rences made and conclusions reached by it. The panel must examine 
whether the explanations provided demonstrate that the investigating authority took 
                                                
32 Article  17.6(ii) of the Anti -Dumping Agreement also provides that if a panel finds that a provision of 
the Anti -Dumping Agreement admits of more than one permissi ble interpretation, it shall uphold a measure 
that rests upon one of those interpretations.  
33 Appellate Body Report, Japan – Alcoholic Beverages  II, p. 10 . 
34 Appellate Body Reports, US – Countervailing Duty Investigation on DRAMS , para.  186; and US – 
Lamb , para. 103. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  proper account of the complexities of the data before it, and that it explained why it 
rejected or discoun ted alternative explanations and interpretations of the record 
evidence. A panel must be open to the possibility that the explanations given by the 
authority are not reasoned or adequate in the light of other plausible alternative 
explanations, and must ta ke care not to assume itself the role of initial trier of facts, 
nor to be passive by "simply accept[ing]  the conclusions of the competent 
authorities ".35  
7.7.  Finally, a panel should not conduct a de novo  review of the evidence, nor substitute its 
judgment for  that of the investigating authority . A panel must limit its examination to the evidence 
that was before the investigating authority  during the course of the investigation and must take 
into account all such evidence submitted by the parties to the dispute .36 At the same time, a panel 
must not simply defer to the conclusions of the investigating authority; a panel's examination of 
those conclusions must be "in -depth" and "critical and searching".37 
7.2.3   Burden of proof  
7.8.  The general principles applicable to the allo cation of the burden of proof in WTO dispute 
settlement require that a party claiming a violation of a provision of a WTO Agreement must assert 
and prove its claim.38 Therefore, as the complaining party, Indonesia  bears the burden of 
demonstrating that the measure at issue is inconsistent with the provisions of the  covered 
agreements that it invokes. The Appellate Body has stated that a complaining party will satisfy its 
burden when it establishes a prima facie  case, namely, a case which, in the absence of e ffective 
refutation by the defending party, requires a panel, as a ma tter of law, to rule in favour of the 
complaining party.39 It is generally for each party asserting a fact to provide proof thereof.40 
7.3  Whether the EU anti -dumping measures imposed on import s of biodiesel from 
Indonesia are inconsistent with Articles 2.2 and 2.2.1.1 of the Anti -Dumping Agreement 
and Article VI:1(b)(ii) of the GATT 1994  
7.3.1   Introduction  
7.9.  Indonesia claims that the anti -dumping measures applied by the European Union on biodiesel 
imports from Indonesia are inconsistent with Articles 2.2 and 2.2.1.1 of the 
Anti-Dumping  Agreement and Article VI:1(b)(ii) of the GATT 1994 , as follows:  
a. First, the European Union acted inconsistently with  the first sentence of Article 2.2.1.1 
and, as a consequence Article 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) 
of the GATT 1994, by failing to calculate the cost of production on the basis of the 
records kept by the producers . Indonesia submits that the costs of crude palm oil ( CPO) 
reflected in the records of the exporting producers were substituted with the reference 
export price for CPO published by the Indonesian authorities .41  
b. Second , the European Union acted inconsistently with  Article 2.2 of the Anti -Dumpin g 
Agreement and Article VI:1(b)(ii) of the GATT 1994 by failing to construct the normal 
value for the Indonesian producers under investigation on the basis of the cost of 
production of biodiesel in the country of origin , Indonesia .42 
7.10.   Indonesia submits that the substance of its claims are indistinguishable from claims raised  
by Argentina under these provisions in the dispute EU – Biodiesel (Argentina)  in respect of 
anti-dumping measures imposed on imports of biodiesel from Argentina.43 Indonesia submits that 
                                                
35 Appellate Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para.  93 (referring to 
Appellate Body Report, US – Lamb , para. 106). (emphasis original)  
36 Appellate Body Report, US – Countervailing Duty Investigation on DRAMS , paras. 187-188. 
37 Appellate Body Report, US – Softwood Lumber VI (Article  21.5 – Canada) , para.  93. 
38 Appellate Body Report, US – Wool Shirts and Blouses , p. 14. 
39 Appellate Body Report, EC – Hormones , para.  104. 
40 Appellate Body Report, US – Wool Shirts and Blou ses, p. 14. 
41 Indonesia's first written submission, para . 44; second written submission, para. 4.  
42 Indonesia's first written submission, para . 99; second written submission, para. 10 . 
43 Indonesia's first written submission, para. 45.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  given the identical fact pattern and decisions made by the European Union, these claim s warrant 
the same finding of inconsistency with the above provisions of the Anti -Dumping Agreement and 
GATT 1994.44 The European Union has not disp uted the relevance of the findings contained in the 
panel and Appellate Body reports in EU – Biodiesel (Argentina) to the resolution of the dispute.45  
7.11.   For the purpose of addressing these claims, we consider below  whether  Indonesia has 
demonstrated that the costs of CPO reflected in the records of the exporting producers46 were 
substituted with the reference export price for CPO published by the Indonesian authorities , and 
thereafter, we address whether in doing so, the European Union acted inconsistently wit h the 
provisions cited by Indonesia.  
7.3.2   The EU authorities ' determination of the cost of production for the construction of 
normal value for Indonesian biodiesel producers  
7.12.   Indonesia submits  that the set of  circumstances facing Indonesia are "essentially ident ical"47 
to the factual circumstances of claims raised by Argentina in EU – Biodiesel (Argentina) . We 
address the similarities in the EU authorities' determination of the cost of production for Argentine 
and Indonesian biodiesel producers in the construction  of normal value before considering 
Indonesia's claims.  
7.13.   On 29 May 2013, the European Commission imposed provisional anti -dumping duties on 
biodiesel originating in Argentina and Indonesia, imposing  provisional anti -dumping duties on 
Indonesian producers at  margins of between zero and 9.6%.48 The EU autho rities concluded that 
since both the Argentine and Indonesian domestic market s for biodiesel were heavily regulated, 
domestic sales were not in the ordinary course of trade, and the normal value would have to  be 
constructed.49 To construct normal value, the EU authorities calculated the normal value by adding 
to the producers' own production costs during the investigation period, the selling, general , and 
administrative (SG&A ) expenses incurred and a reasonable  profit margin.50 At that time, the 
petitioner, the EBB, claimed that the "Differential Export Tax" (DET) system in Argentina and 
Indonesia depresses the price of soybeans and soybean oil (the main raw material input s used in 
the production of biodiesel in Argentina) and CPO (the main raw material input used in the 
production of biodiesel in Indonesia) and therefore distorts the costs of biodiesel producers. The 
EU authorities indicated that they did not have enough information at that stage to make a 
decisi on as to the most appropriate way to address that claim.51 The EU authorities indicated that 
the question as to whether the costs reasonably reflect the costs associated with the production of 
biodiesel would be further examined at the definitive stage.52 
7.14.   In the Definitive Disclosure, the EU authorities confirmed that their further investigation had 
established that the DET system in place  in Indonesia and Argentina depressed the domestic prices 
of the main raw material input in Indonesia and Argentina to art ificially low level s, and as a 
consequence, this affected the cost of biodiesel producers in both countries.53 The EU authorities 
explained that , due to the distortions caused by  the DET system in the respective countries, the 
costs of the main raw material  were not reasonably reflected in the records kept by the 
producers.54 In the case of Indonesia , the EU authorities noted that during the investigation 
period, biodiesel exports were taxed between 2% and 5%, while CPO exports were taxed 
                                                
44 Indonesia's first written submission, paras. 45 and 100.  
45 The European Union acknowledges the factual description provided by Indonesia in respect of its 
claims . (European Union's first written submission, paras. 6 and 14; second w ritten submission, para s. 8 
and 11). The European Union additionally noted that the EU investigating authorities decided to reopen  the 
investigation regarding anti -dumping measures in force equally in respect of imports of biodiesel originating in 
Argentina and Indonesia, follow ing the recommendations and rulings adopted by the DSB in EU – Biodiesel 
(Argentina) . In light of this, the European Union submits that Indonesia's claims are "unnecessary, premature 
and misconceived". (European Union's first written submission, para. 12 ). 
46 We note that the Indonesian government does not set the price of CPO in Indonesia . 
47 Indonesia's first written submission, para. 100; second written submission, para. 11.  
48 Provisional Regulation, (Exhibit IDN -1), recital 179.  
49 Provisional Regulation, (Exhibit IDN -1), recitals 44 -45 and 63 -64. 
50 Provisional Regulation, (Exhibit IDN -1), recital 63.  
51 Provisional Regulation, (Exhibit IDN -1), recitals 45 and 63.  
52 Provisional Regulation, (Exhibit IDN -1), recitals 45 and 63.  
53 General Disclosure Document, A D593, Anti -Dumping Proceeding concerning imports of biodiesel 
originating in Argentina and Indonesia (1 October 2013)  (Definitive Disclosure ), (Exhibit IDN -7), recital 26.  
54 Definitive Disclosure, (Exhibit IDN -7), recitals 25, 34 , and 57.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  between  15% and 20%.  The export for palm fruit was set at a rate of 40%.55 The EU authorities 
concluded  that since the DET system limits the possibility to export CPO, larger quantities of CPO 
are available on the domestic market, which lowers domestic C PO prices. The EU authorities noted 
that the domestic price of CP O was significantly lower than the international reference price, with 
the difference "being very close to the export tax applied to CPO".56 
7.15.   In light of its finding that the markets were distort ed, the EU authorities therefore decided 
to disregard the actual costs of raw materials  as recorded by the  Argentine and Indonesian  
investigated companies in their accounts and replace those costs with the price at which those 
companies would have purchase d the raw materials  in the absence of a distortion , in constructing 
the respective  normal value s of Argentine and Indonesian  producers .57 To replace the costs in the 
records  of Indonesian producers , the EU authorities used the reference price (HPE) for CPO 
published by the Indonesian authorities. The EU authorities explained that the published HPE price 
is a reference export price that is set monthly by Indonesian authorities and averages the 
published international prices from three different sources:  cost, insurance, and freight  (CIF) 
Rotterdam , CIF Malaysia , and the Indonesian commodity exchange market. The HPE price is set on 
the basis of the same sources, on a free on board ( FOB) basis.58  
7.16.   The Government of Indonesia and several Indonesian producers raise d objections 
concerning the decision by the EU authorities to replace the recorded costs of CPO in the 
constructed normal value.59 In the Definitive Regulation, the EU authorities confirmed their 
conclusion that domestic prices of CPO were artificially lowe r than international prices due to the 
distortion caused by  the Indonesian DET. The EU authorities additionally confirmed their decision 
to use reference HPE prices published by the Indonesian authorities and rejected comments made 
by Indonesian producers and the Government of Indonesia.60 
7.3.3   Whether the European Union acted inconsistently with Article s 2.2.1.1 and 2.2 of 
the Anti -Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 , by failing to 
calculate the cost of production of biodiesel on the basis  of the records kept by the 
producers  
7.17.   Indonesia  first request s us to find that the European Union act ed inconsistently with 
Articles  2.2.1.1 and 2.2 of the Anti -Dumping Agreement and with Article VI:1(b)(ii) of the 
GATT  1994 by failing to calculate the cos t of production of the product under investigation on the 
basis of the records kept by the producers. Indonesia refers to the panel and Appellate Body 
findings in EU – Biodiesel (Argentina) in support of it s claim. We note that Indonesia's claim is 
princip ally concerned with the second condition in the first sentence of Article 2.2.1.1  of the 
                                                
55 Definitive Disclosure, (Exhibit IDN -7), recital 60. The EU authorities found that during the 
investigation period biodiesel exports from Argentina were taxed at a nominal rate of 20% with an effective 
rate of 14.58%, while soybean exports were taxed at 35 % and soybean oil exports were taxed at 32%. 
(Definitive Disclosure, (Exhibit IDN -7), recital 31 ). 
56 Definitive Disclosure, (Exhibit IDN -7), recital 59. In the case of Argentine producers, the EU 
authorities noted that the difference between the internatio nal and the domestic price of soya beans and soya 
bean oil is the export tax on the product and other expenses incurred for export ation. Thus, the EU authorities 
concluded that producers of soya beans and soya bean oil obtain the same net price no matter w hether they 
sell for export or domestically. (Definitive Disclosure, (Exhibit IDN -7), recital 33 ). 
57 Definitive Disclosure, (Exhibit IDN -7), recitals 35 and 58.  
58 Definitive Disclosure, (Exhibit IDN -7), fn 8. In the case of Argentine producers, the EU authorities 
replaced the costs at which investigated companies purchased soya beans with the average of the reference 
prices of soya beans published by the Argentine Ministry of Agriculture for export FOB Argent ina during the 
investigation period. (Definitive Disclosure, (Exhibit IDN -7), recital 36 ; see also Definitive Regulation, 
(Exhibit  IDN-2), recitals 35 -42). 
59 P.T. Ciliandra Perkasa, Comments on Definitive Disclosure (17 October 2013 ), (Exhibit IDN -9 (BCI) ), 
pp. 2-23; P.T. Pelita Agung Agrindustri, Comments on Definitive Disclosure: Dumping Margin 
(17 October  2013), (Exhibit IDN -10 (BCI) ), pp. 2-20; Government of Indonesia, Comments on Definitive 
Disclosure (17 October 2013 ), (Exhibit IDN -11), pp. 1-3; Wilma r Group, Comments on Definitive Disclosure 
(17 October 2013 ), (Exhibit IDN -16 (BCI) ), pp. 4-6; and P.T. Musim Mas, Comments on Definitive Disclosure, 
(Exhibit IDN -17 (BCI) ), pp. 5-9. 
60 Definitive Regulation, (Exhibit IDN -2), paras. 66 -74. The EU authoritie s similarly confirmed their 
conclusions that the price of soybean raw materials in Argentina was artificially lower than international prices 
due to the distortion caused by the Argentine DET, and further confirmed their decision to use an international 
reference price as set by the Argentine government. (Ibid.  paras. 35 -42). WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  Anti-Dumping Agreement .61 We also recall that Indonesia asserts that the substance of its claims 
is indistinguishable from claims raised  by Argentina under these provis ions in the EU – Biodiesel 
(Argentina) , and as a result  the same finding of inconsistency  is warranted .62 
7.18.   Articles 2.2 and 2.2.1.1 of the Anti -Dumping Agreement provide as follows:  
2.2 When there are no sales of the like product in the ordinary course of tr ade in 
the domestic market of the exporting country or when, because of the particular 
market situation or the low volume of the sales in the domestic market of the 
exporting country, such sales do not permit a proper comparison, the margin of 
dumping shal l be determined by comparison with a comparable price of the like 
product when exported to an appropriate third country, provided that this price is 
representative, or with the cost of production in the country of origin plus a 
reasonable amount for admini strative, selling and general costs and for profits.63 
… 
2.2.1.1  For the purpose of paragraph  2, costs shall normally be 
calculated on the basis of records kept by the exporter or producer under 
investigation, provided that such records are in accordance wi th the 
generally accepted accounting principles of the exporting country and 
reasonably reflect the costs associated with the production and sale of the 
product under consideration. Authorities shall consider all available 
evidence on the proper allocation  of costs, including that which is made 
available by the exporter or producer in the course of the investigation 
provided that such allocations have been historically utilized by the 
exporter or producer, in particular in relation to establishing appropria te 
amortization and depreciation periods and allowances for capital 
expenditures and other development costs. Unless already reflected in the 
cost allocations under this sub -paragraph, costs shall be adjusted 
appropriately for those non -recurring items of cost which benefit future 
and/or current production, or for circumstances in which costs during the 
period of investigation are affected by start -up operations.[*]   
_______________  
[*fn original]6 The adjustment made for start -up operations shall reflect the costs at the end of 
the start -up period or, if that period extends beyond the period of investigation, the most recent 
costs which can reasonably be taken into account by the authorities during  the investigation.  
7.19.   Article VI:1 of the GATT 1994 reads, in relevant part:  
The contracting parties recognize that dumping, by which products of one country are 
introduced into the commerce of another country at less than the normal value of the 
products, i s to be condemned if it causes or threatens material injury to an 
established industry in the territory of a contracting party or materially retards the 
establishment of a domestic industry. For the purposes of this Article, a product is to 
be considered a s being introduced into the commerce of an importing country at less 
than its normal value, if the price of the product exported from one country to another  
… 
 (b) … is less than …  
… 
                                                
61 Indonesia submits that the European Union acted inconsistently with Article 2.2 of the Anti -Dumping 
Agreement and Article VI:1(b)(ii) of the GATT 1994 as a result of failing to calcu late the costs of production 
consistently with Article 2.2.1.1 of the Anti -Dumping Agreement. (Indonesia's first written submission, 
para. 98). 
62 Indonesia's first written submission, para. 45. 
63 Fn omitted.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  (ii) the cost of production of the product in the country of origin 
plus a reasonable addition for selling cost and profit.  
7.20.   In addressing whether the European Union acted inconsistently with Article 2.2.1.1 of the 
Anti-Dumping Agreement, the panel and the Appellate Body in EU – Biodiesel (Argentina)  both 
found that Article 2.2. 1.1 establishes the records of the investigated producer as the preferred 
source of information for the determination of the cost of produ ction. In this respect, 
Article  2.2.1.1 provides for two circumstances in which an investigating authority can choose not 
to follow the general rule to calculate costs on the basis of the records kept by the 
producer/exporter. The first is that  the records are inconsistent with the generally accepted 
accounting principles of the exporting country . The second is that  the records do not reasonably 
reflect the costs associated with the production and sale of the product under investigation.64 
7.21.   The panel and the Appellate Body both reasoned that the second condition in the first 
sentence of Article 2.2.1.1 does not permit an inv estigating authority to examine the 
reasonable ness of reported costs incurred by an exporting producer when the actual costs 
recorded in the records of the producer or exporter are found within acceptable limits to be 
accurate and faithful.65 Given the stru cture of the first sentence of  Article 2.2.1.1, the 
Appellate  Body considered it clear that the records of the individual exporters or producers under 
investigation are subject to the condition to "reasonably reflect" the "costs".66 The Appellate Body 
expla ined that the condition in the first sentence of Article 2.2.1.1 that the records "reasonably 
reflect" the costs associated with the production and sale of the product under consideration, 
relates to "whether the records kept by the exporter or producer un der investigation suitably and 
sufficiently correspond to or reproduce those costs incurred by the investigated exporter or 
producer that have a genuine relationship with the production and sale of the specific product 
under consideration ".67 The Appellate Body found support for its interpretation in the additional 
rules set out in the second and third sentences of Article 2.2.1.1 and footnote 6 of the 
Anti-Dumping Agreement68, and in Article 2.2, which refers to the costs of production in the 
country of orig in.69  
7.22.   In order to establish whether the records reasonably reflect the costs actually incurred, the 
panel considered a comparison should be made between the costs in the producer's or exporter's 
records and the costs incurred by that producer or exporter. In its view, such a comparison does 
not permit an investigating authority to enquire into whether the records of the producer or 
exporter reasonably reflect some hypothetical costs that might have been incurred under a 
different set of conditions or circum stances. Therefore, an investigating authority should not be 
permitted to evaluate the costs reported in the records kept by the exporter or producer pursuant 
to a benchmark unrelated to the cost of production in the country of origin.70 
7.23.   In assessing whethe r the EU authorities had acted consistently with Article 2.2.1.1 in the 
investigation, the panel found relevant  that the EU authorities decided not to use the cost of 
soybeans in the production of biodiesel in Argentina because "the domestic prices of the main raw 
material used by biodiesel producers in Argentina were found to be artificially lower than the 
international prices due to the distortion created by the Argentine export tax system".71 In the 
panel's view, this did not constitute a legally sufficie nt basis u nder Article 2.2.1.1 for concluding 
that the pro ducers' records did not reasonably reflect the costs associated with the production and 
sale of biodiesel.72 The panel therefore found that the European Union acted inconsistently with 
Article 2.2.1. 1 of the A nti-Dumping Agreement by failing to calculate th e cost of production of the 
                                                
64 Appellate Body Report, EU – Biodiesel (Argentina) , paras. 6.18 and 6.46; Panel Report, EU – Biodiesel 
(Argentina) , para. 7.227.  
65 Appellate Body Report,  EU – Biodiesel (Argentina) , para. 6.37; Panel Report, EU – Biodiesel 
(Argentina) , para. 7.231 and fn 400.  
66 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.20.  
67 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.56.  
68 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.22. See also Panel Report, EU – Biodiesel 
(Argentina) , para. 7.234.  
69 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.23.  
70 Panel Report, EU – Biodiesel (Argentina) , para. 7.242. See also Appellate Body Report, EU – Biodiesel 
(Argentina) , paras. 6.30, 6.37, and 6.39.  
71 Panel Report, EU – Biodiesel (Argentina) , para. 7.248.  
72 Panel Report, EU – Biodiesel (Argentina) , para. 7.248.  WT/DS480/R  
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  producer s under investigation on the basis of the records kept by the producers.73 Having reached 
this finding, t he panel did not consider it necessary for purposes of res olving the dispute to 
address Argentina's further claims that, the European Union failed to properly construct the normal 
value and thus acted inconsistently with Article 2.2 of the Ant i-Dumping Agreement and 
Article  VI:1(b)(ii) of the GATT 1994.74 
7.24.   The Appe llate Body upheld the panel's finding that the European Union acted inconsistently 
with Article 2.2.1.1 in constructing the normal value for Argentine producers.75  
7.25.   We recall  as set out above76, at the definitive stage, the EU authorities revised the 
methodo logy and decided not  to use the recorded costs of the main raw materials ( soybean oil  in 
the case of Argentine producers and  CPO in the case of Indonesian producers) to establish the cost 
of production of biodiesel for Argentine and Indonesian investigated  producers for the same 
reason: that "DET systems depressed the domestic prices of the main raw material input in both 
Argentina and Indonesia to an artificially low level", which was considered to "affect the costs of 
the biodiesel producers in both count ries concerned".77 Thus, the EU authorities applied the same 
rationale for deciding not to use the  recorded  cost of the main raw material to establish the cost of 
production of biodiesel for Argentine and Indonesian investigated producers.   
7.26.   Under these circ umstances, we see no basis to deviate from the findings by the panel in 
EU – Biodiesel (Argentina)  in respect of Indonesia's claim concerning Article 2.2.1.1 of the 
Anti-Dumping Agreement.  Nor has the European Union identified any cogent reasons for us to do 
so.78 Like the panel in EU – Biodiesel (Argentina) , we find that the EU authorities did not provide a 
legally sufficient basis under Article 2.2.1.1 for concluding that the Indonesian producers' records 
did not reasonably reflect the costs associated wit h the production and sale of biodiesel, and 
therefore, we find that the EU authorities acted inconsistently with its obligations under 
Article 2.2.1.1 by derogating from using the costs reflected in the records kept by the producers.79  
7.27.   Based on the foregoing , we uphold Indonesia's claim  that the European Union acted 
inconsistently with Article 2.2.1.1 of the Anti -Dumping Agreement by failing to calculate the cost of 
production of the produce rs under investigation on the basis of the records kept by t he producers.  
7.28.   Indonesia also requests that we find that, as a result  of failing to calculate the costs of 
production consistently with Article 2.2.1.1 of the Anti -Dumping Agreement, the European Union 
failed to properly construct the normal value and thus acted inconsistently with Article 2.2 and 
Article VI:1(b)(ii) of the GATT 1994.80 We recall that Indonesia has requested us to reach t he 
same findings of inconsistency as in EU – Biodiesel (Argentina) , given the identical fact ual 
circumstances  and decisions  made by the European Union.81 In this regard, the panel did not 
consider it necessary for purposes of resolving the dispute to address Argentina's further claims 
under Article 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994.82 We 
have come to the same conclusions regarding Indonesia's claims . 
7.3.4   Whether the European Union acted inconsistently with Article 2.2 of the 
Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 by failing to construct 
the normal value on the basis of  the cost of production in the country of origin  
7.29.   Indonesia separately requests that we find that the European Union acted inconsistently 
with Article 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994  by failing 
                                                
73 Panel Report, EU – Biodiesel (Argentina) , para. 7.249.  
74 Panel Report, EU – Biodiesel (Argentina) , para. 7.250.  
75 Appellate Body Report, EU – Biodiesel (Argentina) , paras. 6.56-6.57. 
76 See paras. 7.14.  -7.16.  above.  
77 Definitive Regulation, (Exhibit IDN -2), recital 30. See also ibid. recitals 35 -42 and 66 -74.  
78 In reaching this finding, we recall that it is well established that adopted panel and Appellate Body 
reports create legitimate expectations, and that the same legal issues should be resolved in the same way in 
subsequent cases , absent cogent reasons for finding differently. (See, for example, Appellate Body Reports, 
Japan – Alcoholic Beverages II , p. 14; US – Stainless Steel (Mexico) , para. 160; US – Shrimp (Article 21.5 – 
Malaysia) , para. 109; and US – Oil Country Tubular Good s Sunset Reviews , para. 188 ). 
79 Panel Report, EU – Biodiesel (Argentina) , para. 7.248.  
80 Indonesia's first written submission, para. 98.  
81 Indonesia's first written submission, para. 45. 
82 Panel Report, EU – Biodiesel (Argentina) , para. 7.250.  WT/DS480/R  
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  to construct the nor mal value on the basis of the cost of production in the country of origin.83 
Indonesia submits that the cost used by the EU authorities for CPO , derived from international 
prices,  cannot be understood to be a cost in the country of origin.84  
7.30.   In addressing  a similar claim raised by Argentina in EU – Biodiesel (Argentina) , the panel 
and the Appellate Body shared the view that the phrase "cost of production in the country of 
origin" in Article 2.2 and "cost of production of the product in th e country of origin " in 
Article  VI:1(b)(ii) may be understood as a reference to the price paid or to be paid to produce 
something within the country of origin.85 The Appellate Body observed that nothing in the 
language of these two provisions precludes that an investigating a uthority may need to look for 
information on the cost of production from sources outside the country.86 However, the reference 
to "in the country of origin", indicates that, whatever information or evidence is used to determine 
the "cost of production", it must be apt to or capable of yielding a cost of production in the country 
of origin. In these instances, information or evidence from outside the country of origin may need 
to be adapted in order to ensure that it is suitable and it is not sufficient to si mply substitute the 
costs from outside the country of origin for the "cost of production in the country of origin".87 
7.31.   In assessing whether the EU authorities had acted consistently with Article 2.2 or 
Article  VI:1(b)(ii) of the GATT 1994 , the panel evaluate d whether the cost used by the EU 
authorities for soybeans could be understood to be a cost in the country of origin, Argentina. The 
panel considered it clear that the EU authorities did not use the cost of soybeans in Argentina , as 
the EU authorities spec ifically selected the average reference price of soybeans published by the 
Argentine Ministry of Agriculture to remove the perceived distortion in the market place caused by 
the Argentine DET. In this respect, the panel stated that the EU authorities selected this cost 
precisely because it was not the cost of soybeans in Argentina.88 The panel therefore found that 
the European Union acted inconsistently with Article 2.2 of the Anti -Dumping Agreement and 
Article VI:1(b)(ii) of the GATT 1994 by failing to cons truct the normal value on the basis of the 
cost of production in Argentina.89 The Appellate Body upheld the panel's finding .90 
7.32.   As with the decision to replace the actual purchase price of soybean reflected in Argentine 
producers' records, the EU authorities replaced the actual purchase price of CPO as reflected in the 
producers' records with an international  HPE reference price published by Indonesian authorities.91 
The EU authorities found that prices of CPO prevailing in Indonesia were artificially lower tha n 
international prices  and considered that the HPE reference price  published by Indonesian 
authorities  served as "the price at which [domestic biodiesel producers] would have purchased the 
CPO in the absence of such a distortion".92 In this sense , the EU au thorities selected the HPE 
reference price  to remove the perceived distortion in the market place caused by the 
Indonesian  DET, in the same way that the EU authorities had selected a reference price to remove 
the perceived distortion in the domestic price of soybeans caused by the Argentine DET. Under 
these circumstances,  in the absence of any rebuttal by the European Union,  we see no basis to 
depart from the analysis undertaken by the panel and the Appellate Body in EU – Biodiesel 
(Argentina ). We therefore  find that the cost  of CPO  used by the European Union in respect of 
Indonesian producers is not a cost "in the country of origin".  
                                                
83 Indonesia's first written submission, para. 100 (referring to Panel Report, EU – Biodiesel (Argentina) , 
para. 7.260 ; and Appellate Body Report, EU – Biodiesel (Argentina) , paras. 6.81 and 6.83 ). 
84 Indonesia's first written submission, paras. 111-116. 
85 Panel Report, EU – Biodiesel (Argentina) , para. 7.256; Appellate Body Report, EU – Biodiesel 
(Argentina) , para. 6.69.  
86 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.73. This could occur for instance, in 
circumstances where the obligation in the first sentence of Article 2.2.1.1 to calculate the costs on the basis of 
the records kept by the exporter or producer under investigation does not apply, or where relevant information 
from the exporter or producer under investigation is not available. (Ibid.). 
87 Appellate Body Report, EU – Biodiesel (Argentina) , paras. 6.70 and 6.73.  
88 Panel Report, EU – Biodiesel (Argentina) , para. 7.258.  
89 Panel Report, EU – Biodiesel (Argentina) , para. 7.260.  
90 Appellate Body Report, EU – Biodiesel (Argentina) , para.  6.83. The Appellate Body recognized that 
domestic prices could in fact reflect world prices , and that prices at the border could simultaneously be 
characterized as both an international and a domestic price. The Appellate Body agreed with the panel, 
howev er, that the mere fact that a reference price is published by the Argentine Ministry of Agriculture does 
not necessarily make this price a domestic price in Argentina. (Ibid.  para. 6.81 ). 
91 See para. 7.15.   above.  
92 Definitive Regulation, (Exhibit IDN -2), recital 67.  WT/DS480/R  
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  7.33.   In light of this finding , we uphold Indonesia's claim that  the European Union acted 
inconsistently with Article 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) of the 
GATT  1994 by using a cost for CPO that was not the cost prevailing "in the country of origin" in the 
construction of normal value.  
7.3.5   Conclusions  
7.34.   We recall above the findings of the panel, as upheld by the Appellate Body in EU – Biodiesel 
(Argentina)  regarding the obligations contained in Article 2.2.1.1 of the Anti -Dumping Agreement, 
and Article 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 . We 
consider the panel's finding s that the European Union acted inconsistently with these provisions in 
that dispute are directly relevant to the assessment of Indonesia's claims in this proceeding. We 
therefore  uphold Indonesia's claim that  the European Union acted incons istently with 
Article  2.2.1.1 of the Anti -Dumping Agreement by failing to calculate the cost of production of the 
produce rs under investigation on the basis of the records kept by the producers . In addition, we  
uphold Indonesia's claim that  the European Un ion acted inconsistently with Article 2.2 of the 
Anti-Dumping Agreement and Article VI:1(b)(ii) of the GATT 1994 by using a cost  for CPO  that was 
not the cost prevailing "in the country of origin" in the construction of normal value.  
7.4  Whether the European Union established an amount for profits inconsistently with 
Article s 2.2 and  2.2.2(iii) of the Anti-Dumping Agreement  
7.4.1   Introduction  
7.35.   Indonesia claims that the method applied by the European Union to establish an amount for 
profits for Indonesian producers is inconsistent with Articles 2.2 and 2.2.2(iii) of the Anti -Dumping 
Agreement . Indonesia allege s that the European Union's approach suffers from two main flaws. 
First, Indonesia claims  that the European Union acted inconsistently with the requirement in 
Article 2.2.2(iii)  to calculate a cap for profits, i.e. "the profit normally realized by other exporters 
or producers on sales of products of the same gener al category in the domestic market of the 
country of origin". Second, Indonesia claims  that the European Union did not determine an amount 
for profits on the basis of a "reasonable " method, as required under Article s 2.2 and 2.2.2(iii).   
7.4.2   The EU authorities ' determination of an amount for profits for Indonesian 
biodiesel producers  
7.36.   Before addressing Indonesia's claim s, we recall the followin g facts related to the 
European  Union's determination of an amount for profits for Indonesian biodiesel producers.  
7.37.   The EU authorities determined  that Indonesian market conditions for biodiesel were such 
that domestic sales were not considered as being made in the ordinary course of trade, and 
therefore, the amount of profit could not be based on actual data from the sample d companies for 
purposes of constructing the normal value of the like product.93 The EU authorities therefore 
resorted to Article 2(6)(c) of the EU Basic Regulation94 (which mirrors the language in 
Article  2.2.2(iii) of the Anti -Dumping Agreement). The EU au thorities determine d the amount for 
profits  as "the reasonable amount of profit that a young and innovative capital intensive industry 
of this type under normal conditions of competition in a free and open market could achieve, that 
is 15% based on turnover".95 The EU authorities subsequently confirmed  in the Definitive 
                                                
93 Provisional Regulation, (Exhibit IDN -1), recital 65. The EU authorities noted that, during the 
investigation period , the fully State -owned oil and gas company Pertamina was the biggest company active on 
the domestic market, representing more than 90% of the domestic biodiesel purchases from the sampled 
producers. The EU authorities determined that Pertamina is mandated  by the State to blend the biofuels with 
fossil fuels for sale at its gas stations, and every month, the Indonesian Ministry of Trade administratively sets 
the "HPE price (or Export Check Price)" as a benchmark price used to calculate the monthly level of export 
duties. Pertamina purchases biodiesel at the level of the HPE price set by the Indonesian government. 
(Provisional Regulation, (Exhibit IDN -1), recital 64 ). 
94 Council Regulation (EC) No. 1225/2009 of 30 November on protection against dumped imports from 
countries not members of the European Community (codified version), OJ L 343, 22.12.2009, and corrigendum 
to Council Regulation (EC) No. 1225/2009, OJ L 7, 12.1.2010.  
95 Provisional Regulation, (Exhibit IDN -1), recital 65.  WT/DS480/R  
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  Regulation  the 15% profit margin  as "a reasonable amount that can be achieved by a relatively 
new, capital -intensive industry in Indonesia" .96 
7.38.   The Government of Indonesia and Indonesian producers submitted  comments during the 
investigatio n, including objections to  the 15% profit margin used when constructing normal value.  
Several Indonesian  producers objected  that the EU authorities should have determined a profit 
amount based on actual amounts on sales of products in the same general cate gory of products, 
pursuant to Article 2(6)(b) of the EU Basic Regulation .97 Two Indonesian producers, P.T. Wilmar 
Bioenergi and P.T. Wilmar Nabati  (Wilmar  Group)  and P.T. Pelita Agung Agrindustri referr ed in this 
regard to sales of oleochemicals in Indonesia .98 Several producers also objected  that the EU 
authorities did not determine a profit cap as required under Article 2(6)(c) of the EU Basic 
Regulation (and Article 2.2.2(iii) of the Anti -Dumping Agreement) and ensure that  the 15% profit 
margin did not exceed  that cap.99 
7.39.   In addition, s everal Indonesian producers asserted  that the EU authorities relied on the 
target profit margin that had been determined for the EU industry  in the context of the 2009 
anti-dumping investigation into biodiesel imports f rom the United States, as the basis to determine 
the 15% margin for Indonesian producers.  These  producers objected that it was not reasonable or 
appropriate to base the profit margin for Indonesian producers on the average profit obtained by 
the EU industr y during the 2004 -2006 period as this is not based on data relating to Indonesia.100 
P.T. Pelita Agung Agrindustri argued that, even in the case that data from Indonesian  producers  
cannot  be used, the EU authorities should have based the profit amount on publicly available data 
relating to other markets rather than basing the profits on the target profit margin of the EU 
industry. P.T. Pelita Agung Agrindustri submitted  that the profit mar gin of 6.8% that was 
established for the US producers  in the 2011 US bioethanol  anti-dumping investigation would have 
been appropriate .101  
7.40.   Several producers argued that, given that  their revenue s were in US dollars (USD), the 
average interest rate for USD l oans offered by private banks in Indonesia for working capital and 
investment loans (which was between 5 % and 6.3%) should be used to determine a profit 
amount.102 Indonesian producer Wilmar  Group argued that EU authorities should have taken into 
account a s tudy prepared by LMC International that conclude d that  actual profit margins in the 
biodiesel sector in Indonesia were between 2.4% and 3.2%.103 Indonesian producer P.T. Musim 
Mas submitted that a 15% profit margin for the producer company was excessive taki ng into 
account an investment cost for a 300,000 ton ne per year palm methyl ester ( PME) plant is about 
USD 30 million in Indonesia. Assuming an average price of PME at USD 1140 per ton ne during the 
                                                
96 Definitive Regulation, (Ex hibit IDN -2), recital 84.  
97 P.T. Pelita Agung Agrindustri, Comments on Provisional Disclosure: Dumping Margin  (1 July 2013 ), 
(Exhibit IDN -15 (BCI) ), pp. 3 and 6; Wilmar Group, Comments on Provisional Disclosure (1 July 2013 ), 
(Exhibit  IDN-13 (BCI) ), pp. 3-5. 
98 Submission by the Wilmar Group filed on 25 July 2013, (Exhibit IDN -14 (BCI) ), p. 1; P.T. Pelita Agung 
Agrindustri, Comments on Provisional Disclosure: Dumping Margin (1 July 2013 ), (Exhibit IDN -15 (BCI) ), p. 6. 
See also Wilmar Group, Comments on Defin itive Disclosure (17 October 2013 ), (Exhibit IDN -16 (BCI) ), p. 12.  
99 P.T. Pelita Agung Agrindustri, Comments on Provisional Disclosure: Dumping Margin (1 July 2013 ), 
(Exhibit IDN -15 (BCI) ), p. 10; P.T. Ciliandra Perkasa, Comments on Definitive Disclosure (17 October 2013 ), 
(Exhibit IDN -9 (BCI) ), pp. 23-25; and P.T. Pelita Agung Agrindustri, Comments on Definitive Disclosure: 
Dumping Margin (17 October 2013 ), (Exhibit IDN -10 (BCI) ), p. 21.  
100 P.T. Pelita Agung Agrindustri, Comments on Provisional Disclosure:  Dumping Margin (1 July 2013 ), 
(Exhibit IDN -15 (BCI) ), pp. 6-9; Wilmar Group, Comments on Provisional Disclosure (1 July 2013 ), 
(Exhibit  IDN-13 (BCI) ), p. 4. See also P.T. Ciliandra Perkasa, Comments on Definitive Disclosure 
(17 October  2013), (Exhibit IDN -9 (BCI) ), pp. 23-25; and P.T. Pelita Agung Agrindustri, Comments on 
Definitive Disclosure: Dumping Margin (17 October 2013 ), (Exhibit IDN -10 (BCI) ), p. 21.  
101 P.T. Pelita Agung Agrindustri, Comments on Provisional Disclosure: Dumping Margin (1 July 2013) , 
(Exhibit IDN -15 (BCI) ), p. 15 (referring to Council Implementing  Regulation (EU) No . 157/2013 of 
18 February  2013 imposing a definitive anti -dumping duty on imports of bioethanol from the United States, 
recital (166)). 
102 P.T. Ciliandra Perkasa, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN -9 (BCI) ), 
p. 26; P.T. Pelita Agung Agrindustri, Comments on Definitive Disclosure: Dumping Margin (17 October 2013) , 
(Exhibit IDN -10 (BCI) ), p. 22; and Government of Indo nesia, Commen ts on Definitive Disclosure 
(17 October  2013) , (Exhibit IDN -11), p. 4. 
103 Wilmar Group, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -13 (BCI) ), p. 5; 
Wilmar Group, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN-16 (BCI) ), p. 12. 
Wilmar  Group considered that such a rate would be in line with commercial interest rate in Indonesia ([[ ***]]). 
(Wilmar Group, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -13 (BCI) ), p. 5). WT/DS480/R  
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  investigation period, a 25% profit margin would result in a payback period of slightly less than  
5 months, which is too ambitious for any young and innovative industry.104  
7.41.   Several  Indonesian  producers  also objected to the EU authorities ' reference to the short and 
medium term  borrowing rate in Indonesia of around 12%  published by the World Bank as a basis 
to confirm  the reasonableness  of the 15% profit margin. Indonesian  producer  P.T. Musim Mas  
submitted  that the 12% borrowing rate was well above its actual borrowing cost of [[***]].105 
Several producers further noted that the EU authorities referred to the short and medium  term 
borrowing rate of 14% in Argentina published by the World Bank  as a basis to confirm the 
reasonable ness of a 15% profit margin applied to Argentine producers, arguing that a different 
treatment is justified for Argentine and Indonesian producers given that  the short and medium 
term borrowing rate in Indonesia is lower (i.e. 12%) as compared to Argentina (i.e. 14%).106 At 
most, they argued  that the 12% rate should have been  used as the pro fit cap under  Article 2(6)(c) 
of the EU Basic Regulation.107 In addition, the Government of Indonesia claimed that it was 
duplicative to replace the CPO costs in the context of constructing normal value while using at the 
same time a 15% profit margin to reflect the profit margin in an undistorted market.108 
7.42.   The EU authorities rejected comments that a profit amount should have been determined 
based on Article 2(6)(b) of the EU Basic Regulation on the ground "that all Indonesian (and 
Argentinian) companies in  the sample don't have sales in the ordinary course of trade of products 
of the same general category of products (i.e. any other fuel)".109 In this regard, the EU authorities 
rejected that sales of a blend of biodiesel with mineral diesel could be used to d etermine a profit 
amount. The EU authorities explained as follows:  
Whether or not the sales of a blend of biodiesel with mineral diesel fall under the 
same general category of products, Article 2(6)(b) of the basic Regulation states, as 
already mentioned i n recital (68) above, that such sales should be made in the 
ordinary course of trade. Given that the domestic sales of biodiesel are not in the 
ordinary course of trade, the sales of the blend of biodiesel with mineral diesel is not, 
mutatis mutandis , cons idered to be in the ordinary course of trade.110 
7.43.   The EU authorities determined that, given the short and medium term  borrowing rate in 
Indonesia is  around 1 2% according to World Bank data, it was reasonable to expect a higher profit 
margin to be obtained whe n doing business in the domestic biodiesel markets than the borrowing 
cost of capital.111 The EU authorities noted that the reference to the medium term borrowing rate 
was not meant to set a benchmark but to "test the reasonableness of the margin used".112 The EU 
authorities also noted that various profit levels were used in the 2009 biodiesel proceeding against 
the United States, with the weighted average profit well above 15%.113 Finally, t he EU authorities 
rejected the argument of the Government of Indonesia t hat it was duplicative to replace the cost 
of CPO  since cost adjustments under Article 2(5)  of the EU Basic Regulation  and the reasonable 
profit under Article 2(6)(c)  of that Regulation  "are two clearly distinct issues ".114 
                                                
104 P.T. Musim Mas, Comments  on Definitive Disclosure, (Exhibit IDN -17 (BCI) ), p. 10.  
105 P.T. Musim Mas, Comments on Definitive Disclosure , (Exhibit IDN -17 (BCI) ), p. 10.  
106 P.T. Ciliandra Perkasa, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN -9 (BCI) ), 
p. 26; P.T. Pelita Agung Agrindustri, Comments on Definitive Disclosure: Dumping Margin (17 October 2013) , 
(Exhibit IDN -10 (BCI) ), p. 22.  
107 P.T. Ciliandra Perkasa, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN -9 (BCI) ), 
p. 25; P.T. Pelita Agung Ag rindustri, Comments on Definitive Disclosure: Dumping Margin (17 October 2013) , 
(Exhibit IDN -10 (BCI) ), p. 21.  
108 Government of Indonesia, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN -11), 
p. 2. 
109 Definitive Disclosure, (Exhibit IDN -7), recital 68. See also Definitive Regulation, (Exhibit IDN -2), 
recital 79.  
110 Definitive Disclosure, (Exhibit IDN -7), recital 72; Definitive Regulation, (Exhibit IDN -2), recital 84.  
111 Definitive Disclosure, (Exhibit IDN -7), recital 72; Definitive Regulation,  (Exhibit IDN -2), recital 84.  
112 Definitive Regulation, (Exhibit IDN -2), recital 84.  
113 Definitive Disclosure, (Exhibit IDN -7), recital 72 ; Definitive Regulation, (Exhibit IDN -2), recital 84.  
114 Definitive Regulation, (Exhibit IDN -2), recital 84.  WT/DS480/R  
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  7.4.3   Whether the  European Union acted inconsistently with Article s 2.2 and 2.2.2(iii) 
of the Anti -Dumping Agreement by failing to calculate a profit cap and ensure that the 
profit margin established for each Indonesian exporter did not exceed that cap  
7.44.   Indonesia first  argues that the European Union violated Article s 2.2 and  2.2.2(iii)  of the 
Anti-Dumping Agreement for the simple fact that it did not calculate the profit cap , i.e. "the profit 
normally realized by other exporters or producers on sales of products of the same g eneral 
category in the domestic marke t of the country of origin" . 
7.45.   Article 2.2 requires an investigating authority to use a "reasonable amount for 
administrative, selling and general costs and for profits" in constructing normal value.  
7.46.   Article 2.2.2 provide s: 
For the purpose of paragraph 2, the amounts for administrative, selling and general 
costs and for profits shall be based on actual data pertaining to production and sales 
in the ordinary course of trade of the like product by the exporter or producer un der 
investigation.  When such amounts cannot be determined on this basis, the amounts 
may be determined on the basis of:   
(i)  the actual amounts incurred and realized by the exporter or 
producer in question in respect of production and sales in the domesti c 
market of the country of origin of the same general category of products;   
(ii)  the weighted average of the actual amounts incurred and realized 
by other exporters or producers subject to investigation in respect of 
production and sales of the like prod uct in the domestic market of the 
country of origin;   
(iii)  any other reasonable method, provided that the amount for profit 
so established shall not exceed the profit normally realized by other 
exporters or producers on sales of products of the same gene ral category 
in the domestic market of the country of origin.  
7.47.   Indonesia argues that Article 2.2.2 imposes two mandatory conditions when  determining an 
amount for profits pursuant to subparagraph  (iii): first, the amount for profits must be determined 
on the basis of "any other reasonable method" ; and second, the amount for profits so established 
shall not exceed the cap defined therein . Indonesia submits that the panels in EC – Bed Linen , 
Thailand – H-Beams , and EU – Footwear (China)  have confirmed that both of these  conditions 
must be met when applying a methodology pursuant to  Article 2.2.2(iii)  and there can be no 
exception to the requirement to meet either of these obligations.115 Indonesia submits that there 
was no discussion of a benchmark for the cap  nor did the EU authorities respond to requests  from 
Indonesian producers for information pertaining to the profit cap.116 Hence, Indonesia considers 
that it is clear that the EU authorities made no  attempt to calculate  a profit cap when applying the 
methodo logy under Article 2.2.2(iii) .  
7.48.   The European Union argues that Article 2.2.2(iii) requires only that a profit margin 
established by an  investigating authority does not  exceed such a cap , and there is no mandatory 
requirement in Article 2.2.2 (iii) to calcul ate a profit cap . In the European Union's view, a profit 
margin may not exceed the cap even  absent any express reference to its calculation in the 
determination .117 The European Union further  considers  that t here cannot be an obligation  on an 
                                                
115 Indonesia' s first written submission, paras. 138 -142 (referring to Panel Reports , EU – Footwear 
(China) , paras. 6.52 and 7.300 -7.301; Thailand – H-Beams , para. 7.12 4; and EC – Bed Linen , para. 6.9 7). See 
also Indonesia's first written submission, paras. 156 (referring to Panel Report, EU – Footwear (China) , 
para. 7.300 ). 
116 Indonesia's first written submission, paras. 146 -150. 
117 European Union's opening statement at the first meeting  of the Panel , para. 22. The United States 
shares the view that there cannot be  an obligation to calculate the profit cap when the necessary information 
for such a calculation does not exist. Moreover, the United States submits that an investigator is not obliged to 
calculate a cap and indicate what that cap amount is in its determin ation, but rather an investigating authority 
may use "any other reasonable method" to determine an amount for profits so long as that amount so WT/DS480/R  
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  investigating authority  to calculate the profit cap when the necessary information for such 
calculation does not exist , making it objectively impossible to calculate the cap .118 The 
European  Union contends that this was precisely the case in the inves tigation at hand, as sampled 
Indonesian companies did not provide information to the EU authorities of sales in the ordinary 
course of trade of products in the same general category that could have been used to calculate a 
profit cap . The European Union also rejects that there is any requirement that an investigating 
authority must  solicit the necessary data from non -investigated Indonesian producers, arguing 
that EU authorities  do not have the  authority to ob lige any party  to provide data to calculate a 
cap.119 
7.49.   The parties' arguments raise the  issue of whether there is a mandatory requirement in 
Article 2.2.2 (iii) to calculate a profit cap, or whether, as the European Union argues , there are 
exceptions to the requirement, for instance, in cases where investig ated companies do not provide 
information to the investigating authorities of sales in the same general category of product, or it 
is not possible to calculate a cap for some other reason .  
7.50.   We find no basis for the European Union's argument that there is no mandatory requirement 
in Article 2.2.2 (iii) to calculate a profit cap.  We recall, as previou s panels have observed, 
Article  2.2.2(iii) permits an investigating authority to use "any other reasonable method" to 
determine an amount for profit subject to a ceiling or cap, defined as "the profit normally realized 
by other exporters or producers on sales of products of the same general category in the domestic 
market of the country of origin".120 The panel in EU – Footwear (China) found that the 
European  Union acted inconsistently with Article  2.2.2(iii) precisely for the reason that it had failed 
to consider the calculation of the cap at the time it made its determination.121 Furthermore, in 
reachin g its finding,  the panel  found unconvincing  the argument that had been made by  the 
European Union that the necessary data for calculating the cap was not available.  Even accepting 
that data was not available for calculating a cap,  the panel reasoned that an investigating 
authority  cannot be excused  from complying with the requirements in Article 2.2.2(iii).122 
7.51.   We share the view of the panel in EU – Footwear (China) , including the view that an 
investigating authority may not be excuse d from the obligation to c alculate the cap  whenever 
applying a methodology pursuant to  Article 2.2.2(iii) based on the argument that data is not 
available . We consider that there are important reasons for requiring an investigating authority to 
calculate a cap and to further provid e details  on the cap  in the determination. Absent this 
information, interested parties would be unaware of whether the determined amount for profit 
exceed s the cap or not. This lack of  information would improperly place the burden on interested 
parties to then try  to demonstrate that  the chosen  amount for profit  is in excess of the cap . The 
burden would also shift to a WTO Member representing the exporting producers to bring a 
challenge and demonstrate before a WTO panel that the profit amount used in const ructing normal 
value exceeds the cap and is therefore in violation of Article 2.2.2(iii). We also consider  that the 
obligation to calculate the cap is fundamental for the reason mentioned by Indonesia; namely that, 
absent a firm obligation, investigating a uthorities would be incentivized to adopt a passive 
approach to establishing a cap as a way to lessen their  obligation under Article 2.2.2(iii).123 
7.52.   As concerns the investigation that is the subject of the present dispute, we have no 
evidence that the EU authorities addressed the issue of the cap in the investigation . Furthermore, 
the European Union has confirmed in this proceeding that the EU authorities were not able to 
calculate a cap for profits.124 Since it is clear that the EU authorities did not calcu late a cap, it is 
                                                                                                                                                  
established does not exceed the profits normally realized by producers of the same general category of 
products in the exporting country. In such a situation, the United States submits that a complaining party 
would need to demonstrate before a WTO panel that a breach of Article 2.2.2(iii) results. 
(United  States'  third-party submission, para. 18 ; third-party respon se to Panel question No. 1, para. 1 ). 
118 European Union's opening  statement at the first meeting  of the Panel , paras. 23 -25. 
119 European Union's first written submission, paras. 41 -46. 
120 Panel Reports , EU – Footwear (China) , paras. 6.52 and 7.300 -7.301; Thailand – H-Beams , 
paras.  7.124 -7.125; and  EC – Bed Linen , paras. 6.97 -6.98. 
121 Panel Report, EU – Footwear (China) , paras. 7.299 -7.300.  
122 Panel Report, EU – Footwear (China) , para. 7.300. ("Even assuming it to be the case that relevant 
data on the basis of wh ich the cap could be calculated was not available to the Commission in this case, we fail 
to see how this excuses the Commission from complying with the requirements of the AD Agreement" .) 
123 Indonesia's second written submission, para. 35.  
124 European Union's first written submission, para. 51.  WT/DS480/R  
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  equally clear that the EU authorities failed to ensure that the amount for profit did not exceed that 
cap, contrary to the second condition set forth in Article 2.2.2(iii).  
7.53.   While we share the view of the panel in EU – Footwear (China)  that an investigating 
authority may not be excused from the obligation to calculate the cap whenever applying a 
methodology pursuant to Article 2.2.2(iii) based on the argument that data is not available , we 
shall also address the parties' arguments as to whether or not data necessary to calculate a profit 
cap was available to the investigating authority in the underlying investigation . 
7.54.   As a general matter, Indonesia sees no basis as to why the EU authorities could not have 
solicit ed additional data from produ cers. Indonesia submits that the EU authorities regularly solicit 
data from producers, including producers located in third countries when investigating non -market 
economies. Furthermore , Indonesia submits that an investigating authority could resort to 
information from publicly available sources to determine the cap.125 Indonesia considers that this 
would not have been necessary in the present investigation, as the EU authorities had the 
necessary data before them on which to calculate a profit cap. First, I ndonesia submits that the EU 
authorities chose to limit the same general category of products to "other fuels", as reflected in 
recital 68 of the Definitive Disclosure.126 Indonesia submits that one producer, Wilmar  Group  and 
related party [[***]] provided i nformation on the profit margins obtained on sales of blends of 
biodiesel and mineral diesel,  i.e. "other fuels",  which could have provided a basis to calculate the 
cap.127 Even if these sales were considered to be unacceptable, Indonesia submits that the 
European Union has also acknowledged that [[***]] had sales of diesel fuel and marine fuel oil  – 
also "other fuels" – which could have been used.128  
7.55.   Alternatively, Indonesia argues that the EU authorities could have defined the "same 
general category" as oleochemicals, and used profit  data for sales of oleochemicals to calculate the 
profit cap.  Indonesia submits that the technical, physical , and chemical characteristics of a product 
as we ll as input materials and the production process are relevant factors to determining whether 
products are in the same general category.129 Indonesia submits that oleochemicals and biodiesel 
are produced from the same feedstock through a similar process, shar e the same basic properties , 
and address the  technical markets and therefore, both should be considered to fall within the same 
general category of basic organic chemicals.130 Indonesia considers it was particularly unwarranted 
to reject profits on sales of oleochemicals, considering that  the EU authorities  decided  to include 
biodiesel for non -fuel use in the scope of the product concerned. In recital 24 of the Definitive 
Regulation, Indonesia notes tha t the EU authorities denied a request for end -use relief for biodiesel 
for non -fuel use "in view of the fact that biodiesel declared as for non -fuel use has the same 
physical properties as biodiesel for fuel use".131 More generally, Indonesia rejects that the scope of 
the same general category of products (describ ed as "any other fuel") can be found to be narrower 
than the scope of the product concerned (as including biodiesel for non -fuel use).132 More 
                                                
125 Indonesia's first written submission, para. 156; response to Panel question No. 68, para. 17; and 
second written submission, paras. 31 -32. 
126 Indonesia's response to Panel question No. 64, paras. 7 -8; Definitive Disclosure, (Exhibit IDN -7), 
recital 68 ("Article 2(6)(b) is not applicable given that all Indonesian (and Argentinian) companies in the 
sample don't have sales in the ordinary course of trade of products of the same general category of products  
(i.e. any other fuel)").  
127 Indonesia' opening statement at the first meeting  of the Panel , para. 20; response s to Panel question 
No. 6, para. 14, and No. 64, para. 10 . 
128 Indonesia's response to Panel question No. 64, paras. 4 -8. 
129 Indonesia's response to Panel question No. 13, paras. 18 -19. Indonesia notes that demand side 
factors may all be relevant to the determination of the same general category of products, but are a less 
important factor in cases where there are dual or multi ple uses of the product concerned. (Ibid. paras. 23 -24). 
130 Indonesia's first written submission, paras. 151 -153 (referring to Wilmar Group, Comments on 
Provisional Disclosure (1 July 2013) , (Exhibit IDN -13 (BCI)) , pp. 6-7); Definitive Disclosure, (Exhibit IDN-7), 
recital 68.  
131 Indonesia's second written submission, para. 46 (referring to Definitive Regulation, (Exhibit IDN -2), 
recital 24 ). 
132 Indonesia's second written submission, para s. 49-50. Indonesia finds support for this conclusion in 
Article 3.6 of th e Anti -Dumping Agreement which states that:  WT/DS480/R  
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  generally, Indonesia submits that  an investigator should not be permitted to define  the same 
general category of pr oducts  too narrowly , as doing so effectively allows an investigating authority 
to choose to exclude using sales of other products to calculate a profit cap, which thereby enables 
the investigator to evade complying with the requirements of Article 2.2.2(ii i).133 
7.56.   The European Union disagrees with Indonesia that the "same general category of products" 
should be construed in an overly broad manner, especially given that the intention behind the 
methodologies contained in Article 2.2.2 is to approximate as closel y as possible the price of the 
like product in the domestic market of the exporting country. In this respect, the European Union 
agrees with the reasoning set out by the panel in Thailand – H-Beams  that, the broader the same 
general category of products is  construed, the potential increases that the constructed normal 
value will not be representative of the price of the like product.134  
7.57.   The European Union argues  that Indonesia has not met its burden of proof to explain why 
other oleochemicals constitute the same category of products with biofuels, taking into account 
their different end uses and markets, and different profit margins for that matter.135 The 
European  Union also sees no contradiction in the narrow approach with respect to determining the 
same gene ral category of products (i.e. limiting the same general category to "any other fuel"), 
while the prevention of circumvention requires a broader approach to defining the scope of the 
product subject to investigation .136 
7.58.   Finally, the European Union submits that it would not have been appropriate to base a profit 
cap on sales of blended biodiesel with mineral diesel, as the European Union contends that sales of 
blended biodiesel with mineral diesel suffered from the "same d eficiencies" as sales of biodiesel, 
i.e. these sales were found, mutatis mutandis , not to be in the ordinary course of trade because 
they contained domestically sold biodiesel in their blend, which was found not to be in the ordinary 
course of trade.137 The European Union considers that the reference  in Article 2.2.2(iii) to profit 
"normally" realized operates to permit an investigating authority t o reject data that is obviously 
distorted by some act of State for purposes of calculating a profit cap.  While th e European Union 
does not suggest an "ordinary course of trade" requirement is included in Article 2.2.2(iii), the 
European Union argues that the fact that sales of a given product are not in the ordinary course of 
trade informs the analysis of "normally" under Article 2.2.2(iii). In other words, in certain 
occasions data can simultaneously be not in the ordinary course of trade and not "normal" within 
the meaning of Article 2.2.2(iii). The European Union finds support for its argument in the 
following disc ussion of the Appellate Body in US – Hot-Rolled Steel  that was made in the context of 
Article 2.1:  
In terms of the above definition, Article 2.1 requires investigating authorities to 
exclude sales not made "in the ordinary course of trade", from the calcul ation of 
normal value, precisely to ensure that normal value is, indeed, the "normal" price of 
the like product, in the home market of the exporter. Where a sales transaction is 
concluded on terms and conditions that are incompatible with "normal" commerci al 
practice for sales of the like product, in the market in question, at the relevant time, 
the transaction is not an appropriate basis for calculating "normal" value.138 
                                                                                                                                                  
The effect of the dumped imports shall be assessed in relation to the domestic production of the 
like product when available data permit the separate identification of that production on the basis 
of such criteri a as the production process, producers' sales and profits. If such separate 
identification of that production is not possible, the effects of the dumped imports shall be 
assessed by the examination of the production of  the narrowest group or range of produ cts, 
which includes the like product , for which the necessary information can be provided.  
(emphasis added)  
133 Indonesia's second written submission, paras. 53 -54. 
134 European Union's opening statement at the first meeting  of the Panel , paras. 27 -28 (referr ing to 
Panel Report, Thailand – H-Beams , paras. 7.112 and 7.115 ). 
135 European Union's first written submission, paras. 47 -48, opening statement at the first meeting  of 
the Panel , para. 29; response to Panel question No. 19, paras. 39 -40; and second written submission, 
para. 35. 
136 European Union's second written submission, para. 36.  
137 European Union's second written submission, para. 25.  
138 Appellate Body Report, US – Hot-Rolled Steel , para. 140.  WT/DS480/R  
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  7.59.   As highlighted by this passage, the European Union argues that the rationale of providi ng 
for a cap for profits which is used to construct the profit is to ensure that the chosen profit is 
"normal" in the domestic market.139 In its view, the fact that sales of biodiesel blended with 
mineral diesel  were found not to be in the ordinary course of  trade establishes that they are not an 
appropriate basis to calculate the profit cap as there was no profit "normally" realized on sales of 
blended biodiesel with mineral diesel by other exporters or producer s within the meaning of 
Article  2.2.2(iii).140  
7.60.   Indonesia  disagrees with the European Union's interpretation of the word "normally" in 
Article 2.2.2(iii) . Indonesia argues  that the term "normally"  in Article 2.2.2(iii)  is intended to limit 
the discretion of an investigating authority  by not allowing it t o use data that is a statistical outlier.  
In this sense, the profit cap cannot be based on a statistical outlier, but should be based for 
instance on an average of profit data as taken from various sources. Indonesia contends that its 
interpretation is sup ported by the structure of Article 2.2.2, as well as the use of the word 
"normally" in other provisions of the Anti -Dumping Agreement. Indonesia submits that the term 
"normally" cannot be intended as having the same meaning as the language "in the ordinary  
course of trade" that is used elsewhere in the Anti -Dumping Agreement, which provides 
investigating authorities with discretion to take into account commercial conditions surrounding 
sales and disregard certain sales on that basis.141 
7.61.   The parties ' debate as  whether or not it was possible to calculate a profit cap in the 
particular investigation raise s several  additional questions  regarding the discretion of an 
investigating authority surrounding the determination of the profit "normally" realized by other 
exporters or producers and the scope of the same general category of products.  
7.62.   We begin by noting that Article 2.2.2(iii) does not specify a particular requirement on an 
investigating authority as to how to define what products fall within the same general category of 
products, for purposes of determining "the profit normally realiz ed". We agree with the 
European  Union that there is no obligation to construe the scope of products in the same general 
category broadly. The panel in Thailand – H-Beams  noted tha t the methodologies in Articles 2.2 
and 2.2.2 aim to approximate the price of the like product. Re ferring in that case to 
Article  2.2.2(i), the panel observed that the use of a broader category of products when defining 
the same general category of product s means that more products other than the like product will 
be included, which in turn may result in a constructed normal value that is less representative of 
the price of the like product.142 We share this view and consider it equally applicable in the cont ext 
of Article 2.2.2(iii).  
7.63.   Against this background, we see no basis why the European Union would be required to 
treat oleochemi cals as falling within the same general category as biodiesel . In our view, a 
reasonable and objective authority may conclude th at the same general category of products is a 
narrower category.143 In light of this discretion, based on the information we have before us, we 
disagree with Indonesia that the EU authorities were necessarily required to rely on data on sales 
of oleochemical s as a basis to calculate the profit cap under Article 2.2.2(iii) . In stating this, we do 
not mean to suggest that the EU authorities were therefore excused from establishing the profit 
cap. 
                                                
139 European Union's second written submission, para s. 21-33. 
140 The European Union recalls that Indonesia has not disputed the finding by the EU authorities that 
there were no sales of biodiesel in the ordinary course of trade in Indonesia. (European Union's first written 
submission, para. 23 (referring to Definitive Regulation, (Exhibit IDN -2), recital 28 )). The European Union 
further submits that data provided on sales of blends of biodiesel and mineral diesel could not be used for 
purposes of Article 2.2.2(iii) because profit amounts were only provided on the biodie sel element, and not the 
sales of the blended product. (European Union's opening statement at the second meeting  of the Panel , 
paras.  18-19). Indonesia disputes this argument. (Indonesia's response to Panel question No. 64, paras. 4 -10). 
141 Indonesia's resp onse to Panel question No. 71, paras. 26 -35. See also response to Panel question 
No. 70, para. 25.  
142 Panel Report, Thailand – H-Beams , para. 7.115.  
143 The European Union submits that according to Wilmar Group's website, oleochemicals are a very 
broad catego ry of products, including soap , noodles, refined glycerine, cosmetic esters and palm waxes. 
(European Union's response to Panel question No. 19, para 40 (referring to  Wilmar Group website 
http://www .wilmar -international.com/our -business/tropical -oils/manuf acturing/tropical -oils-
products/oleochemicals/  (accessed 28 September 2017))) . WT/DS480/R  
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  7.64.   We also see no issue with the decision of the EU authorities to d efine the scope of the same 
general category of products as "any other fuel"144 while at the same time deny ing a request for 
end-use relief for biodiesel for non -fuel use. We recall that Article 2.2.2 aims to approximate the 
price of the like product. In app roximating this price, an investigating authority may determine a 
category of products that fall in the same general category for purposes of constructing an amount 
for profit (or SG&A expenses) with the goal of approximating as closely as possible the pri ce of the 
like product. This decision to define the category in this way could result, for instance, from the 
fact that a significant portion of sales of the product concerned fall within that category based on a 
particular end use (e.g. as a fuel). At the  same time, an investigating authority may determine the 
need to take action to prevent circumvention in respect of products sold in the domestic market 
with similar physical properties but different end uses. In the case at hand, the EU authorities 
determ ined that the product for which end -use relief was requested had similar physical properties 
and could be further processed and thereby converted for use as a fuel.145 
7.65.   We disagree, however, with the European Union's interpretation of the term "normally" in 
Article 2.2.2(iii) . We see no basis for  the European Union's argument that "profit normally realized" 
in Article 2.2.2(iii) means  that an investigator may disregard  the profit realized on sales that are 
considered not compatible with normal commercial practice. The word "normally" is defined as 
"[i]n a regular manner; regularly" or "[u]nder normal or ordinary conditions ; as a rule, ordinarily " 
or "[i]n a normal manner, in the usual way".146 This suggests that the term "normally" in 
Article  2.2.2(iii) refe rs to commonality of occurrence, and therefore to  profits that are regularly , 
ordinarily, usually, or as a rule  realized. We consider this understanding is  consistent with the way 
that the word "normally" is used, for example,  in footnote 8 of the Anti -Dumping Agreement, 
concerning what the date of sale should "normally", i.e. usually, be. Similarly, Article 5.8 states 
that the volume of dumped imports shall "normally" be regarded as negligible , except in the case 
countries which individually account for le ss than 3 % of the imports of the like product in the 
importing Member collectively account for more than 7 % of imports of the like product in the 
importing Member . 
7.66.   We find that t he structure of sub paragraphs  of Article 2.2.2  is also relevant in this regard . 
Subparagraphs (i) and (ii) refer to the use of "actual amounts", without any qualification that such 
sales must relate to any form of "normal" commercial conditions. The three alternative methods 
for calculating profit amounts in the three subparagraphs constitute "close approximations"147 of 
the general rule contained in the chapeau  of Article 2.2.2 , and while subparagraphs (i) and (ii) 
express a preference for the actual data regarding the exporter and like product in question, there 
is "an incremental pr ogression away from these principles before reaching 'any other reasonable 
method' in Article 2.2.2(iii)".148 Since the data becomes more approximate as one progresses from  
subparagraph  (i) to subparagraph (iii), it seems highly unlikely that the drafters would have 
envisaged an investigating authority considering the "normality" of the commercial conditions 
under subparagraph (iii) but not under subparagraph s (i) and (ii).   
7.67.   In addition, we are not persuaded  by the European Union's reliance on the findings of the 
Appellate Body in US – Hot-Rolled Steel  that: 
In terms of the above definition, Article 2.1 requires investigating authorities to 
exclude sales not made "in the ordinary course of trade", from the calculation of 
normal value, precisely to ensure that normal value is, indeed, the "normal" price of 
the like product, in the home market of the exporter. Where a sales transaction is 
concluded on terms and conditions that are incompatible with "normal" co mmercial 
practice for sales of the like product, in the market in question, at the relevant time, 
the transaction is not an appropriate basis for calculating "normal" value.149 
7.68.   In that case, the Appellate Body necessarily understood "normal value" as referri ng to sales 
that are compatible with normal commercial practice.  This does not mean that th e term "normal" 
                                                
144 Definitive Disclosure, (Exhibit IDN -7), recital 68.  
145 Definitive Regulation, (Exhibit IDN -2), recital 23.  
146 Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007), 
Vol. 2, p. 1945 . 
147 Panel Report, EC – Bed Linen , para. 6.60. 
148 Panel Report, EU – Biodiesel (Argentina) , para. 7.335.  
149 Appellate Body Report, US – Hot-Rolled Steel , para. 140.  WT/DS480/R  
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  should be interpreted through out the Anti -Dumping Agreement as referring to normal commercial 
practice, particularly when an "ordinary course of trad e" standard is not expressly provided for , or 
in cases where the term "normally" appears to relate more to commonality of occurrence.  
7.69.   We therefore disagree with the European Union's interpretation of "normal" and its view 
that data available to establish " profits normally realized" within the meaning of Article 2.2.2(iii) 
may be disregarded in circumstances where, according to the European Union, "all of the data 
might be obviously distorted by some act of the State"150 or data pertains to sales that are not 
considered as being made in the ordinary course of trade. Consequently , we also disagree  with the  
assessment  that it was appropriate  to disregard information on profit amounts on sales of blends 
of biodiesel with mineral diesel for the purposes of calculating the cap  for the same reason, i.e. 
that sales were not considered as being made in the ordinary course of trade .151 
7.70.   We also have  doubts regarding the failure  of the EU authorities to consider whether data on 
sales of diesel fuels and marine fuel oil by [[***]] could have been used to determine the profit 
cap, considering that these products could be considered as "other fuels", and hence, would fall 
within the same general category of product .152 In our view, t he EU authorities could have 
considered these sales  for the determination of the profit cap . 
7.71.   Ultimately, an investigating authority retains a degree of discretion to define the same 
general category of products pursuant to Article 2.2.2(iii). In this particula r investigation, we 
believe that there were sales of products in the same general category that could  have provided a 
basis to calculate the cap. In addition , if an investigating authority chooses to reject data provided 
in the investigation, the investiga ting authority would then be required to seek relevant data 
elsewhere, including from publicly available sources in order to comply with its obligations under 
Article 2.2.2(iii). We are  also not persuaded by the European Union's argument that the term 
"normally" in Article 2.2.2(iii)  permits an investigating authority to  enquire into the commercial 
conditions surrounding those sales and to  disregard certain sales based on the prevailing 
commercial conditions .  
7.72.   For the foregoing reasons, we therefore disagre e with the argument of  the European Union 
that it was objectively impossible to calculate the profit cap in the underlying investigation.  In 
reaching this finding, we agree with the European Union that there is no obligation to construe the 
scope of products in the same general category broadly, and therefore, the EU authorities were not 
required to treat oleochemicals as falling within the same general category as biodiesel. We also 
agree with the decision of the EU authorities to define the scope of the same general category of 
products as "any other fuel" while at the same time denying a request for end -use relief for 
biodiesel for non -fuel use. However, we reject the European Union's argument that the phrase 
"profits normally realized" within Article 2.2.2(iii) permits an investigating authority to disregard 
data on sales that are not considered compatible with normal commercial practice . Consequently, 
we also reject the argument that it would have been appropriate to disregard information on profit 
amounts on sales of blends of biodiesel with mineral diesel for the purposes of calculating the cap 
for the same reason, i.e. that sales were n ot considered as being made in the ordinary course of 
trade. In addition, we also find that the EU authorities should have considered sales of  diesel fuels 
and marine fuel oil by [[***]] to determine the profit cap.153 
7.73.   Accordingly, we conclude that Indonesia  has demonstrated that the European Union acted 
inconsistently with Article 2.2.2(iii) of the Anti -Dumping Agreement in the original investigation in 
                                                
150 European Union's second written submission, para. 23.  
151 We recall that the EU authorities did not specifically address in the investigation whether data on 
sales of blends of biodiesel and mineral diesel could be used to calculate the profit cap for purpo ses of 
Article  2.2.2(iii). The EU authorities instead concluded that data on sales of blends of biodiesel and mineral 
diesel of one Indonesian producer could not be used to determine a profit amount under Article 2(6)(b) of the 
EU Basic Regulation, which i mplements the obligation contained in Article 2.2.2(i) of the Anti -Dumping 
Agree ment, subject to the additional requirement that sales in the same general category be made in the 
ordinary course of trade. (Definitive Regulation, (Exhibit IDN -2), recital 84 ).  
152 Definitive Disclosure , (Exhibit IDN -7), recital 68.  
153 Indonesia rejects the European Union's assertions that it was not possible to calculate a profit cap as 
ex post rationalization that should be rejected. (Indonesia's first written submission, para s. 141 and 149 -150; 
second written submission, para. 28 ). In light of our disagreement with the European Union's position that it 
was objectively impossible to calculate a profit cap based on a lack of data before it, we do not consider it 
necessary to add ress Indonesia's argument further.  WT/DS480/R  
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  determining the amount for profits for Indonesian producers  by failing to determine the profit cap, 
i.e. "the profit normally realized by other exporters or producers on sales of products of the same 
general category in the domestic m arket of the country of origin" . As a result of this violation, 
Indonesia further  requests that we find the European Union also acted inconsistently with 
Article  2.2 of the Anti -Dumping Agreement.154 We note that the chapeau  of Article 2.2.2 indicates 
that amounts for administrative, selling , and general costs and for profits shall be determined 
"[f]or the purpose of paragraph 2" of Article 2 of the Anti -Dumping Agreement. Accordingly, w e 
consider  that Indonesia's claim under Article 2.2 is purely consequential and  we therefore 
additionally find that the European Union  acted inconsistently with Article 2 .2 of the Anti -Dumping 
Agreemen t. 
7.4.4   Whether  the European Union  determined  a profit margin for Indonesian producers  
on the basis of a "reasonable method"  within the meaning of Article 2.2.2(iii) of the 
Anti-Dumping Agreement  
7.74.   Indonesia additionally seeks a finding that the European Union  acted inconsistently with 
Article 2.2.2(iii) of the Anti -Dumping Agreement because the European Union failed to determine 
the amount for profit based on a "reasonable method " within the meaning of  Article 2.2.2(ii i) of 
the Anti -Dumping Agreement . The Europ ean Union submits that the method on which the EU 
authorities determined the level of profits was reasonable, and the resulting amount was also itself 
reasonable.155 We now address and make findings with respect to this addition al aspect of 
Indonesia's claim , as our views in this regard could be relevant in the context of implementation.  
7.75.   Argentina raised a similar claim in EU – Biodiesel (Argentina)  that, through the 
determination of a 15% profit margin for Argentine producers, the European Union failed to 
determine an amount for profits on the basis of a reasonable metho d within the meaning of 
Article  2.2.2(iii).156 The EU authorities applied the same methodology when determining an 
amount for profits for both Argentine and Indonesian producers during the biodi esel investigation, 
and determined the same profit margin for all Argentine and Indonesian producers, i.e. 15% based 
on turnover  as "a reasonable amount that can be achieved by a relatively new, capital intensive 
industry " in Argentina and Indonesia .157 The panel in EU – Biodiesel (Argentina)  found that 
Argentina failed to  establish that the E uropean Union  acted inconsistently with Article 2.2.2(iii) in 
its determination of a 15% margin in constructing the Argentine producers' normal value.158 This 
finding was not the subject of an appeal.  
7.76.   Indonesia acknowledges the panel's finding in EU – Biodiesel (Argentina)  but nevertheless 
maintains that this does not prevent  the Panel from finding in this proceeding that the same 15% 
profit margin established for Indon esian producers was not determined pursuant to a reasonable 
method as required by Article 2.2.2(iii). In this regard, Indonesia submits that there are factual 
differences between Argentine and Indonesian producers , and the evidence before the EU 
authoritie s during the investigation clearly demonstrate s that a different margin should have been 
chosen for Indonesian producers .159 The European Union submits that, although the facts are not 
identical in the two cases, Indonesia has not met its burden of proof as complai nant to establish 
that the method for calculating profits for Indonesian producers was not reasonable or that the 
amount was not reasonable.160  
7.77.   We have set out the facts in paragraphs 7.37.   to 7.43.   above  related  to the 
Europ ean Union's determination of an amount for profits for Indonesian biodiesel producers. Under 
its approach , the EU authorities took as a starting point the profit mar gin that the EU biodiesel 
industry was reasonably expected to achieve during the early stages of development of the 
industry in 2005 -2006, which was found to be 15%. The European Union confirmed that thi s 
amount was  the average profit obtained by the EU in dustry during the 2004 -2006 period  which  
                                                
154 Indonesia's first written submission, para. 180; second written submission, para. 84.  
155 European Union's first written submission, para. 34.  
156 Panel Report, EU – Biodiesel (Argentina) , paras. 7.307 -7.351. Unlike Indones ia in this dispute, 
Argentina did not separately claim that the European Union acted inconsistently with the requirement in 
Article  2.2.2(iii) to calculate a cap for profits and to ensure that the profit margin did not exceed such a cap.  
157 Definitive Regu lation, (Exhibit IDN -2), recitals 44 and 84.  
158 Panel Report, EU – Biodiesel (Argentina) , para. 7.351.  
159 Indonesia's first written submission, para. 165 ; second written submission, para. 60.  
160 European Union's first written submission, paras. 37 -38. See also comments on Indonesia's response 
to Panel question No. 75, para. 22.  WT/DS480/R  
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  had been determined  in the context of the 2009 anti -dumping duty investigation into biodiesel 
imports from the United States.161 The EU authorities considered that it was reasonable to use this 
15% profit margin for t he Indonesian and Argentine biodiesel industries as these industries were 
found to be at the same stage of development as the EU industry during the 2005 -2006 period.162 
As indicated in the Definitive Regulation, the EU authorities confirmed the reasonablene ss of the 
15% profit margin by looking at the short and medium term  borrowing rate s in both Argentina and 
Indonesia, which was found to be 14% and 12%, respectively,  according to World Bank data. The 
EU authorities specifically noted that the reference to the short and medium term  borrowing rate 
was not meant to set a benchmark but to "test the reasonableness" of the margin used.163 The EU 
authorities considered it reasonable to expect a higher profi t margin to be obtained in the domestic 
market than the prevailing borrowing cost of capital in those countries . Accordingly, the 15% profit 
was found to be "a reasonable amount that can be achieved by a relatively new, capital -intensive 
industry in Indone sia".164 
7.78.   Since  the panel in EU – Biodiesel (Argentina)  evaluated the methodology  used by the EU 
authorities  – which is the same methodology used to establish an amount for profits for 
Indonesian producers  – to establish a profit margin for Argentine producer s, we begin by recalling 
those findings. We will then assess the relevance of those findings in light of the arguments raised 
by Indonesia in this dispute .  
7.79.   In EU – Biodiesel (Argentina) , the panel began with an assessment of what constitutes "any 
other reasonable method" under Article 2.2.2(iii)  before assessing "whether reliance on such a 
method can be discerned from the explanations provided by the EU authorities in the investigation 
at issue" .165 We first refer to  the panel 's interpretation of the meani ng of "any other reasonable 
method" under Article 2.2.2(iii):  
We turn first to the ordinary meaning of the term "method" in the context of 
Article  2.2.2(iii). Dictionary definitions of the term include "[p]rocedure for attaining 
an object", "[a] mode of pr ocedure; a (defined or systematic) way of doing a thing", 
and "[a] written systematically -ordered collection of rules, observations, etc. on a 
particular subject". [575] Based on these definitions, we understand the term "method" 
to refer, in general terms,  to a process or procedure, as opposed to an outcome.  
The context  of the term in Article 2.2.2(iii) sheds further light on its scope. First, the 
term is qualified by the words "any other". The use of "any" suggests a particularly 
broad scope [576], and the  use of "other" suggests that the other subparagraphs of 
Article 2.2.2 illustrate what may be captured by the term "method" under 
Article  2.2.2(iii). In that regard, we note that the chapeau and paragraphs preceding 
Article 2.2.2(iii) provide, in relevant part, that the amounts for administrative, selling 
and general costs and for profits may be "based on" or "determined on the basis of": 
(i) actual data pertaining to production and sales in the ordinary course of trade of the 
like product by the exporter o r producer under investigation; (ii) the actual amounts 
incurred and realized by the exporter or producer in question in respect of the same 
general category of products; or (iii) the weighted average of the actual amounts 
incurred and realized by other ex porters or producers subject to investigation in 
respect of production and sales of the like product. [577] It is significant, in our view, 
that these three alternatives refer to the kind of specific data on which the amount of 
                                                
161 European Union's response to Panel question No. 7, paras. 6 -8. See also Panel Report, EU – Biodiesel 
(Argentina) , para s. 7.340 -7.342 ; and Commission Regulation (EC) No. 193/2009 of 11 March 2009 imposing a 
provisional anti -dumping duty on imports of biodiesel originating in the United States of America , 
(Exhibit  IDN-25), recital 164.  
162 The European Union has confirmed tha t the EU authorities ' finding in respect of investigated 
Argentine producers was based on the same finding. (European Union's response to Panel question No. 7, 
paras. 6 -8). 
163 Definitive Regulation, (Exhibit IDN -2), recital 84. The EU authorities confirmed the reasonableness of 
the 15% profit margin for Argentine producers by looking at the short and medium term borrowing rate in 
Argentina, which was found to be 14% according to World Bank data. (Definitive Regulation, (Exhibit IDN -2), 
recital 44) . 
164 Definit ive Regulation, (Exhibit IDN -2), recital 84. The EU authorities reached the same finding in 
respect of investigated Argentine producers. (Definitive Regulation (Exhibit IDN -2), recital 44 ; see also 
Provisional Regulation, (Exhibit IDN -1), recitals 44 and 6 5). 
165 Panel Report, EU – Biodiesel (Argentina) , para. 7.333.  WT/DS480/R  
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  profit can be determined, rat her than a specific procedure or methodology for the 
calculation of the amount for profits. This suggests to us that the term "method" in 
subparagraph (iii) refers to a reasoned consideration of the evidence before the 
investigating authority for the deter mination of the amount for profits, rather than to 
a pre -established procedure or methodology. [578] In addition, these "other" methods 
indicate a preference for the actual data regarding the exporter and like product in 
question, with an incremental progre ssion away from these principles before reaching 
"any other reasonable method" in Article  2.2.2(iii). It flows from that context that the 
phrase "any other reasonable method" may be used in the absence of reliable data 
concerning the actual exporter or oth er exporters and the like product. [579] This, in 
turn, suggests that an investigating authority would u sually have recourse to 
Article  2.2.2(iii) in circumstances where its options for basing the determination of an 
exporter's profit margin are constrained . This context, together with absence of any 
additional guidance in Article 2.2.2(iii) on what the "method" chosen should entail in 
terms of either the source or scope of the data or procedure, suggests to us a broad 
and non -prescriptive understanding of t he term.  
Second, as we have noted above, in addition to the requirement that it be determined 
on the basis of "any reasonable method", Article 2.2.2(iii) imposes a ceiling on the 
amount for profits determined [580], requiring that the amount for profits "n ot exceed 
the profit normally realized by other exporters or producers on sales of products of the 
same general category in the domestic market of the country of origin". The presence 
of this constraint, in the absence of any other guidance on the kind of "method" to be 
adopted, confirms our broad and non -prescriptive understanding of the term 
"method".  
We now turn to assess what constitutes a "reasonable" method in the context of 
Article  2.2.2(iii). In the context of Article 2.2.2(iii), it is clear from th e use of "any 
other" before "reasonable" that what is "reasonable" is connected to the preceding 
paragraphs and the chapeau and that the "methods" set in the preceding paragraphs 
and the chapeau are presumptively reasonable. As we have discussed, these ind icate 
a preference for the actual data of the exporter and like product in question, with an 
incremental progression away from these principles before reaching "any other 
reasonable method" in Article 2.2.2(iii). In our view, this context suggests that the  
general function of Article 2.2.2 is to approximate what the profit margin (as well as 
administrative, selling and general costs) would have been for the like product in the 
ordinary course of trade in the domestic market of the exporting country. [581] Thus, in 
our view, the reasonableness of the method used under Article  2.2.2(iii) for 
determining the profit margin turns on whether it is rationally directed at 
approximating what that margin would have been if the product under consideration 
were sold i n the ordinary course of trade in the domestic market of the exporting 
country.  
Based on the foregoing considerations, we understand the term "any other reasonable 
method" in Article 2.2.2(iii) to involve an enquiry into whether the investigating 
authority 's determination of the amount for profits is the result of a reasoned 
consideration of the evidence before it, rationally directed at approximating the profit 
margin to what would have been realized if the product under consideration had been 
sold in the ordinary course of trade in the exporting country.166  
[fn original]575 Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University 
Press, 2007), Vol.  1, p. 1767.  
[fn original]576 Appellate Body Reports, US – Anti-Dumping and Countervai ling Duties (China) , 
fn 197; Canada – Autos  para. 79.  
[fn original]577 See above, para. 7.310, for the text of Article 2.2.2(iii) of the 
Anti-Dumping  Agreement . 
[fn original]578 Argentina acknowledges that "neither of the two procedures set forth in (i) and (ii) 
represents a complex or elaborated method. They are rather simple" (adding, however, that 
"they go beyond the mere unsubstantiated assertion with respect to what profits are"). 
(Argentina's response to Panel question No. 108, para. 86)  
                                                
166 Panel Report, EU – Biodiesel (Argentina) , paras. 7.334 -7.338.  WT/DS480/R  
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  [fn original]579 We note that the panel in EC – Bed Linen  found that there is no hierarchy among 
the methods for determining the amount for profits in Articles 2.2.2(i) -(iii). (Panel Report,  EC – 
Bed Linen , para. 6.59). The question of the interaction between these methods, or a potential 
hierarchy among them, has not been raised in this dispute and accordingly we express no views 
in that regard.  
[fn original]580 We note that the ceiling does  not apply to the determination of the amounts for 
administrative, selling and general costs.  
[fn original]581 Panel Report, Thailand – H-Beams , para. 7.112.  
7.80.   Thus, t he panel reached the view  that "any other reasonable method" in Article 2.2.2(iii) 
"involve[s] an enquiry into whether the investigating authority's determination of the amount for 
profits is the result of a reasoned consideration of the evidence before it, rationally directed at 
approximating the profit margin to what would have been re alized if the product under 
consideration had been sold in the ordinary course of trade in the exporting country" .167 
7.81.   The panel then turned to examine whether the EU authorities' explanations for determining 
a 15% profit margin as applied to Argentine produc ers in the investigation met this requirement.  
In its evaluation, t he panel found relevant  that the application by the petitioner EBB had drawn 
attention to findings made by the EU authorities in the 2009 investigation into biodiesel imports 
from the Unite d States that a profit margin of 15% "represented a level reasonable achieved by 
the European Union biodiesel industry"168, in particular, as a profit level that would reasonably 
guarantee productive investment for a "newly established" biodiesel industry.169 The panel took 
the view that the EU authorities had therefore  arrived at the figure of 15% based on their 
experience with the relevant industry in other investigations. Accordingly, t he panel concluded that 
"the EU authorities arrived at the 15% figure by taking into account the characteristics of a 
biodiesel industry that is 'young', 'innovative' and 'capital intensive' and by drawing on their earlier 
experience in a recent, similar investigation".170 
7.82.   The panel next noted the EU authorities ' explanation that  they had "tested" the 15% margin 
by comparing it to the short and medium term borrowing rate in Argentina of  around 14%  that 
was published by the World Bank . The panel was of the view that the  EU authorities'  determination 
of the amount for profits "proceeded from a reasoned consideration of the evidence before 
them" .171 In particular,  the panel concluded that  the 15% figure was chosen  on the basis of what 
appear to be plausible similarities  between  the stage of development of the Argentine biodiesel 
industry at the time of the investigation, on the one hand, and the stage of development of the EU 
industry at t he time of the investigation of biodiesel from the United States, on the other hand.  
The panel disagreed with Argentina that such an approach did  not qualify as a "method" within the 
meaning of Article 2.2.2(iii).172 
7.83.   The panel then proceeded to evaluate the reasonableness of the EU authorities' approach . 
The panel concluded that " an unbiased and objective investigating authority could reasonably 
consider, as an initial step , that profit margins determined in prior investigations of other 
producers in the same industry at similar stages of development provide an indication of the p rofit 
margins of producers in a subsequent investigation. "173 The panel fu rther reasoned that it would 
be appropriate for an unbiased and objective investigating authority to "test" that figure against 
relevant benchmarks. Notably, the panel found that the EU authorities had considered four such 
benchmarks, including : the World Bank indicator for short and medium term borrowing rates 
(which was 14%);  the rate of the actual profits of Argenti ne biodiesel producers (which were  "in 
excess of 25% "174); a 5% benchmark that had been proposed by one Argentine producer  as a 
profit figure  that was regularly  used in si milar commodity -related markets;  and an 11% 
benchmark representing target profit in the context of determining the injury elimination margin 
for the EU industry .175 The panel was persuaded by the EU argument that a 5% margin was n ot 
                                                
167 Panel Report, EU – Biodiesel (Argentina) , para. 7.338.  
168 Panel Report, EU – Biodiesel (Argentina) , para. 7.340.  
169 Panel Report, EU – Biodiesel (Argentina) , para. 7.340.  
170 Panel Report, EU – Biodiesel (Argentina) , para. 7.342.  
171 Panel Report, EU – Biodiesel (Argentina) , para. 7.344.  
172 Panel Report, EU – Biodiesel (Argentina) , para. 7.344.  
173 Panel Report, EU – Biodiesel (Argentina) , para. 7.347.  
174 Panel Report, EU – Biodiesel (Argentina) , para. 7.348.  
175 Panel Report, EU – Biodiesel (Argentina) , para. 7.348.  WT/DS480/R  
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  systematically used, as well as the argument that the 11% figure was not appropriate for a "young 
and innovative" biodiesel industry.176 
7.84.   On this basis, the panel found "the selection and testing of the  15% profit margin resulted 
from a reasoned analysis t hat … was rationally directed at approximating what the Argentine 
producers ' profit margin for the like product would have been if the like product had been sold in 
the ordinary course of trade in the domestic market of the exporting country" .177 
7.85.   The panel noted what it described as a "degree of inconsistency" in the EU 
authorities ' assessment, including in the decision to reject a request by Argentine producers to use 
the 11% figure, as that was the figure used for calculating the target profit in the conte xt of 
determining the injury elimination margin for the EU industry in the US biodiesel  investigation, 
instead of the 15% profit rate.178 Notwithstanding  this observation , the panel reasoned that an 
objective and unbiased investigating authority could have p lausibly differentiated between the 
determination of the profit margin of Argentine producers for the purpose of constructing normal 
value on the one hand, and the determination of the profit margin of the European Union industry 
for the purpose of determi ning the level of injury, on the other hand. The panel found this was 
reasonable given the view that the EU domestic industry had matured, justifying a reduction in its 
target profit in the absence of dumped imports, while the Argentine industry was found to be 
"young and innovative".179 
7.86.   Based on the above reasoning, the panel therefore found that Argentina failed to  establish 
that the E uropean Union  acted inconsistently with Article 2.2.2(iii) in its  determination of a 15% 
margin.180  
7.87.   We are of the view that t he panel 's assessment that the approach taken by the EU 
authorities constitutes  a "method" within the meaning of Article 2.2.2(iii)  also applies in this 
dispute.181 We further note that Indonesia has not disputed this finding. Accordingl y, we are not 
required to assess whether the approach taken by the EU authorities in respect of Indonesian 
producers constitutes a "method" under Article 2.2.2(iii). The only question  that we are required to  
consider is whether  the method used  by the EU autho rities in respect of Indonesian producers was 
"reasonable " within the meaning of Article 2.2.2(iii). We will therefore consider the 
parties ' arguments in relation to this issue.  
7.88.   There is no disagreement between the parties regarding the decision by EU auth orities to 
consider the profits obtained by the biodiesel industry outside of Indonesia (in this case the profits 
obtained by the EU authorities in the 2005 -2006 period)  as a relevant starting point to determine 
the reasonable profit margin for Indonesian producers.182 However, Indonesia maintains tha t the 
focus of Article 2.2.2(iii) is on the profit margin in the exporting country and not the profit margin 
obtained by the same industry in another country.183 Accordingly, Indonesia argues that the Panel 
must en quire into whether the EU authorities' determination of the amount of profits is the result 
of a reasoned consideration of the evidence before it that is rationally directed at approximating 
the profit margin in Indonesia .184 In this respect, Indonesia considers that it has given prima facie  
evidence that the EU authorities failed to  take into account important difference s in the stage of 
development of the Indonesian biodiesel industry  as compared to the EU indust ry in the 
2005-2006 period, an d has therefore established that the European Union failed to apply a 
reasonable method in respect of Indonesian producers. Therefore, Indonesia considers  that the 
burden of proof shifts to the European Union to rebut its claim.185 The European Union contend s 
                                                
176 Panel Report, EU – Biodiesel (Argentina) , para. 7.348.  
177 Panel Report, EU – Biodiesel (Argentina) , para. 7.349.  
178 The panel sta ted: "there seems to be a degree of inconsistency between this reasoning, on the one 
hand, and the use by the EU authorities of the 15% profit margin determined on the basis of its earlier 
experience from the United States investigation, on the other". (Panel Report, EU – Biodiesel (Argentina) , 
para. 7.350 ). 
179 Panel Report, EU – Biodiesel (Argentina) , para. 7.350.  
180 Panel Report, EU – Biodiesel (Argentina) , para. 7.351.  
181 Panel Report, EU – Biodiesel (Argentina) , para. 7.344.  
182 Indonesia's second written submission, para. 66.  
183 Indonesia's first written submission, para. 163 (referring to Panel Report, EU – Biodiesel (Argentina) , 
para. 7.33 8). 
184 Indonesia's second written submission, para. 66.  
185 Indonesia's response s to Panel qu estion No. 75, para. 49 , and No. 76, paras. 50 -51. WT/DS480/R  
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  that statements made by Indonesia do not qualify as prima facie  evidence, but rather, constitute 
assertions unsupported by evidence, which are inadequate to establish  its claim. The 
European  Union submits that, in any event,  it has provided the necessary  rebuttal in the 
information it has provided.186 
7.89.   According to Indonesia , the evidence shows that the European Union industry was "two, 
maximum three years ol d" during the 2005 -2006 period. Indonesia submits that t he evidence also 
shows that  some of the Indon esian producers were already active in the biodiesel industry in 2006 
and 2007, which means that the Indonesian industry was already five to six years old  during the 
investigation period  in 201 1 and 201 2. In Indonesia's view, t his demonstrates  that the 
European  Union's claim that the Indonesian industry was at a similar stage of development as the 
European Union industry was in 2005 -2006 is factually incorrect.187 
7.90.   The European Union submits that the  EU authorities properly concluded that the  Indonesian 
biodiesel industry was at a similar stage of devel opment during the investigation period as the 
European Union was during the 2005 -2006 period . The European Union argues that information in 
the public domain shows that the EU biodiesel industry star ted in the 1990s. Hence, the EU 
industry would have been more than five to six years old by the 2005 -2006 period and there is no 
basis to Indonesia 's argument that the European Union industry was between two and thre e years 
old during that period.188 
7.91.   The Eur opean Union further submits that  it is not sufficient to establish the maturity of one 
industry or another by reference to the number of years an industry has been in existence. The 
European Union submits that a biodiesel industry in one country may develo p more quickly or 
slowly than a biodiesel industry in another  country .189 The European Union submits that  reference 
to production volumes, the pace of increase or stagnation of production volumes, the number of 
producers and the level of competition , and the  overall size of the producing country may be 
helpful elements in assessing the stage of development of a biodiesel industry.190 In this 
respect,  the European Union has submit ted publicly available evidence on the production levels of 
the EU industry in the 2004-2005 period as compared to Indonesian product ion levels in 2012. 
The European Union submits that EU production reached nearly 2 million tonnes  in 2004, 
3 million  tonnes  in 2005, and 5 million tonnes  in 2006. In comparison , annual production reached 
2.2 million tonnes in Indonesia in 2012, similar to the production volume of the EU industry in the 
years 2004 and 2005.191 
7.92.   We note that Indonesia has also not disputed the statement that the EU industry started in 
the 1990s.192 Indonesia also does not disagre e that factors other than the date of starting 
operations  – such as the pace of development  or production volumes  of biodiesel industries  – may 
be relevant for determining whether the Indonesian industry was at a similar stage of development 
as the EU indu stry was in the 2005-2006 period .193 Indonesia has not commented on  or otherwise 
objected to  production statistics submitted by the European Union194, which , according to the 
European Union , shows that production in Indonesia in 2012 was similar to that of the  EU industry 
in the 2004 -2005 period.  To the extent that production volumes may indicate  the stage of 
development of an industry, the figures submitted by the European Union  suggest that the 
                                                
186 European Union's comments on Indonesia's response to Panel question No. 75, para. 22.  
187 Indonesia's second written submission, paras. 70 -71. 
188 European Union's response to Panel question No. 7 5, para s. 30-32. 
189 European Union's opening statement at the second  meeting  of the Panel , para. 31. 
190 European Union's response to Panel question No. 74, para. 28; comments on Indonesia's response to 
Panel question No. 74, para. 19.  
191 European Union's response to Panel question No. 75, paras. 31 -32 (referring to European Biodiesel 
Board, EU production statistics 1998 -2013, (Exhibit EU -6 (numbered by the Secretariat) (submitted as 
Exhibit  EU-4 in response to Panel question No. 75, para.  31)); ECOFYS , International biodiesel markets: 
Developments in production and trade  (Berlin, 2011) , (Exhibit EU -3 (numbered by the Secretariat) (submitted 
as Exhibit EU -1 in response to Panel question No. 74, para. 29 and No. 75, para. 31 )); and USDA , Indonesia 
Biofuels Annual Report 2017 (20  June 2017) , (Exhibit EU -4 (numbered by the Secretariat) (submitted as 
Exhibit EU -2 in response to Panel question No. 74, para. 29 and No. 75, para. 32 ), p. 13))). 
192 Indonesia did not provide comments on the Europea n Union's response to Panel question No. 75, in 
which the European Union contended that information in the public domain shows that the EU biodiesel 
industry started in the 1990s.  
193 Indonesia's response to Panel question No. 75, para. 49.  
194 USDA, Indonesia  Biofuels Annual Report 2017 (20 June 2017) , (Exhibit EU -4 (numbered by the 
Secretariat) (submitted as Exhibit EU -2 in response to Panel question No. 74, para. 29 and No. 75, para. 32)).  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  EU industry had similar annual production in the 2004 -2005 period  as compared to Indonesia's 
annual production in 2012. In our view, this would suggest that it was not unreasonable for the 
EU authorities  to find that the two industries were at a similar stage of devel opment . Based on this 
observation, it seems plausible  to rely on the profits obtained by the EU industry in the 2005 -2006 
period as a starting point for its determination of a profit amount for sampled Indonesian 
producers.   
7.93.   The figures on annual production volumes also call into question Indonesia's argumen t that 
the Indonesian industry had been in existence (five to six years at the time of the investigation) 
much longer than the EU industry had been in the 2005 -2006 period (roughly two to three years) . 
Even if we accept Indonesia's contention that the matu rity of an industry may be established 
based on the number of years in existence, the similarity in production volumes contradict 
Indonesia's position. On the contrary, the similarity in production volumes supports the position of 
the European Union that t he pace of development may be very different in different countries.  
Overall , we are not persuaded by Indonesia's argument that the EU authorities failed to take into 
account important differences in the stage of development, as a basis to establish that t he EU 
authorities did not apply a reasonable methodology.  
7.94.   The parties  have also responded to a question from the Panel regarding the stages of 
development of the Argentine and Indonesian industries  during  the investigation period . Indonesia 
submits that th e Indonesian biodiesel industry was at a more advanced stage than the Argentine 
industry at the time of the investigation.195 In support of this statement, as set out in the 
complaint submitted in this investigation, Indonesia submits data on  the installed c apacity for 
biodiesel in Indonesia and Argentina  in the 2008 -2012 period.196 The European Union rejects that 
the Indonesian and Argentine industries were at different stages of development  at the time of th e 
investigation, referring to production volumes dur ing the 2006 -2012 period.197 Based on our 
review of this information , we are not convinced that the EU authorities acted  unreasonably  in 
their determination of a profit amount for both sampled Argentine and Indonesian producers.  
7.95.   Indonesia further takes issue  with the EU authorities ' decision to confirm the reasonableness 
of the 15% profit margin by reference to the short and medium term borrowing rates published by 
the World Bank. First, Indonesia submits that the Indonesian producers submitted detailed 
information, including company -specific information to demonstrate what would be a reasonable 
profit margin and that the EU authorities should have taken this evidence into account.198 
Indonesia submits that such company -specific information provide s a more appro priate approach 
to determining the profit amount in the Indonesian market than World Bank data, which reflects 
data for the overall country, and not the biodiesel industry.199 Second, Indonesia also argues that 
the EU authorities failed to take into account that the World Bank short and medium term 
borrowing rate was lower for Indonesia (i.e. 12%) than for Argentina (i.e. 14%). In Indonesia 's 
view, while a 14% short and medium term rate might support the reasonableness of a 15% 
                                                
195 Indonesia's response to Panel question No. 74, paras. 45 -46. 
196 Indonesia submits data on the installed capacity for Indonesia was  4.5 billion litres in 
November  2010 and 4.8 billion litres in April 2012 while it can be seen that the installed capacity in Argentina 
was 2.8 billion litres in 2010. Indonesia notes that the I ndonesian biodiesel i ndustry reached a capacity of 
3 billion litres in 2008, pointing out that the Argentine industry reached that capacity three years later in 2011. 
(Indonesia's response to Panel question No. 74, para s. 45 (referring  to Annex 18 to the C onsolidated version of 
the new anti -dumping complaint concerning imports of biodiesel originating in Argentina and Indonesia,  
(Exhibit IDN -34); and Complaint , (Exhibit IDN -3)), and 46 (referring to USDA , Indonesia Biofuels Annual 
Report  2010 (20 December  2010); and Complaint , (Exhibit IDN -3)). 
197 According to the European Union, the Argentine and Indonesian biodiesel industries both began 
operating in small volumes in the 2006 -2007 period. The European Union submits that reports in the public 
domain estima te a level of production of 50,000 tonnes in Indonesia in 2006, and 30,000 tonnes in Argentina 
in 2006, which increased to 500,000 tonnes and 230,000 tonnes in 2008, resp ectively. In 2012, the 
European  Union submits that annual production had levelled some what, reaching 2.2 mill ion tonnes in 
Indonesia and 2.8  million tonnes in Argentina. (European Union's response to Panel question No. 74, para. 29 
(referring to ECOFYS , International biodiesel markets: Developments in production and trade  (Berlin, 2011) , 
(Exhibit EU -3 (numbered by the Secretariat) ); USDA , Indonesia Biofuels Annual Report 2017 (20 June 2017) , 
(Exhibit EU -4 (numbered by the Secretariat) ), p. 13; and USDA , Argentina  Biofuels Annual Report 201 5 
(1 July 2015), (Exhibit EU -5 (numbered by the Secre tariat) ), p. 14)). 
198 Indonesia's first written submission, paras. 171 -173. 
199 Indonesia's second written submission, paras. 73 -74. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  margin  for Argentina , the same cannot be said for a 12% short and medium term rate, which is 
significantly lower than the determined 15% profit margin.200  
7.96.   The European Union argues  that the EU authorities ' approach to confirm  the reasonableness 
of the 15% margin by comparing it to the World Bank short and medium term  borrowing rate for 
Indonesia  was reasonable . The European Union contends that t he EU authorities  found it was 
reasonable to expect biodiesel producers to obtain a profit margin that exceeded that level .201 With 
respect to data provided by certain  Indonesian producers , including actual profit margins , the 
European Union submits that the data was less reliable than World Bank data.202 In this regard , 
the European Union notes  that the actual profits on domestic sales of biodiesel of all but one of the 
four Indonesian sampled producers were in fact higher than 15% , reaching  30%.203  
7.97.   We first address  the decision by the EU authorities to confirm  the reasonableness of the 
15% margin by comparing it to the short and medium  term borrowing rate in Indonesia.  We recall 
that there is no particular methodology prescribed by Article 2.2.2(iii), subject to the requirement 
that an investigating authority uses a "reasonable method". An investigating authority therefore 
has discretion  in the approach it takes. In this respect, the EU authorities selected the profit 
amount obtained by the EU authorities in the 2005 -2006 period and confirmed the reasonableness 
of this figure by testing it against certain benchmarks. In particular, t he se lection and testing of 
the 15% profit margin against the short and medium term borrowing rate in Argentina was found 
in EU – Biodiesel (Argentina)  to have resulted from a reasoned analysis that was rationally 
directed at approximating the profit margin for  sales by biodiesel producers, domestic sales by 
Argentine producers  in that case .204 We consider it would also be  appropriate for t he EU authorities 
to follow the same approach in respect of Indonesian producers, so long as it can be considered to 
have been reasonable. We note the European Union's explanation that the short and medium  term 
borrowing rate in Indonesia  was not intended as a profit cap, in the sense of Article 2.2.2(iii). We 
do not find this approach inherently unreasonable, despite the fact that the short and medium  
term borrowing rate s in Indonesia and Argentina are not identical, in particular considering that 
the rate  was not intended to constitute a profit cap. We  therefore disagree with Indonesia that the 
lower short and medium term  borrowing rate for Indonesia  demonstrates that the method followed 
by the EU authorities in respect of Indonesian producers was unreason able.  
7.98.   We now turn to the data submitted by Indonesian producers during the investigation  
regarding what would be a reasonable profit margin.  In this connection, Indonesian producers 
provided data that : a reasonable profit margin for the biodiesel in dustry  would be between 2.4 % 
and 3.2% on turnover205; actual borrowing costs wer e around [[ ***]]206; the profit margin 
established by the European Union would imply an unrealistically short payback period207; and the 
average interest rate for USD loans offered by priv ate banks in Indonesia for working capital and 
investment loans (which  was between 5 and 6.3%).208 We recall that the EU authorities considered 
it reasonable to rely on the 15% profit margin  based on what it considered to be plausible 
similarities between th e stage of development of the EU and the Indonesian biodiesel industries 
and to then test the reasonableness of that rate. In the exercise of its discretion, an investigating 
authority may not consider it appropriate to rely on  all data that is provided by interested parties. 
                                                
200 Indonesia's first written submission, paras. 168 ; second written submission, paras. 77 -78. 
201 European Union's first written submission, para. 33.  
202 European Union's response to Panel question No. 10, para. 12.  
203 European Union's first written submission, para. 39; second written submission, para. 39; and 
response to Panel question No. 12 , para. 17  ("Even if it was not explicitly mentioned in the measure at issue, 
the profit realized by three of the Indonesian producers was actually higher than 15% , while for the 
fourth  producer it was only slightly lower.")  
204 Panel Report, EU – Biodiesel (Argentina ), para. 7.349.  
205 Wilmar Group, Comments on Definitive Disclosure (17 October 2013) , (Exhibit IDN -16 (BCI)) , p. 12.  
206 Submission by the Wilmar Group filed on 25 July 2013 , (Exhibit IDN -14 (BCI)), p. 2. 
207 Indonesia's first written submission, para. 128 (referring to P.T. Musim Mas, Comments on Definitive 
Disclosure, (Exhibit IDN -17 (BCI)) , p. 2). Indonesian producer P.T. Musim Mas submitted that a 15% 
profit  margin for the producer company was excessive taking into account an investm ent cost for a 
300,000  tonnes per year PME plant is about US D 30 million in Indonesia. Assuming an average price of PME at 
USD 1140 per ton ne during the investigation period, a 25% profit margin would result in a payback period of 
slightly less than 5 months, which is too ambitiou s for any young and innovative industry. ( P.T. Musim Mas, 
Comments on Definitive Disclosure, (Exhibit IDN -17 (BCI) ), p. 10) . 
208 P.T. Pelita Agung Agrindustri, Comments on Definitive Disclos ure: Dumping Margin 
(17 October  2013) , (Exhibit IDN -10 (BCI)) , p. 22. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  In this particular  case, the EU authorities found the Indonesian biodiesel market was distorted and 
thus, did not consider it appropriate to base the determination of normal value on actual values.   
7.99.   Finally,  we note that Indonesia question s the determination of a 15% margin, considering 
that the EU authorities had adjusted the target p rofit for the domestic industry  downwards from 
15% to 11% , after finding  that the EU industry had mat ured since the 2005 -2006 period. 
Indonesia notes that a  similar adjustment was not m ade for the Indonesian industry  despite the 
fact that  the Indonesian industry was more mature during the investigation period than the EU 
industry was during the 2005 -2006 period.209 The panel in EU – Biodies el (Argentina)  addressed 
this argument.210 The panel took the view that this was reasonable given the view that the EU 
domestic industry had matured, justifying a reduction in its target profit in the absence of dumped 
imports, while the Argentine industry w as found to be "young and innovative".211 We have rejected 
above Indonesia's argument that the Indonesian industry was at a different (more advanced) 
stage of development than the EU  industry was during the 2005 -2006 period . Absent convincing 
evidence that the industry was at a different stage of development, we do not find the approach 
taken by the EU authorities was unreasonable . 
7.100.   For the foregoing reasons , we therefore reject Indonesia's request that we find that the 
European Union  additional ly acted inconsistently with Article 2.2.2(iii) because the European Union 
failed to determine the amount for profit based on a "reasonable method " within the meaning of  
Article 2.2.2(ii i) of the Anti -Dumping Agreement . 
7.4.5   Conclusion s 
7.101.   As indicated abov e, we conclude that there is a mandatory requirement in Article 2.2.2 (iii) 
to calculate a profit cap , i.e. "the profit normally realized by other exporters or producers on sales 
of products of the same general category in the domestic market of the country of ori gin". As the 
EU authorities did not establish , or even attempt to establish  such a cap in the investigation of 
Indonesian producers, we  find that Indonesia has demonstrated that the European Union acted 
inconsistently with Article 2.2.2(iii) of the Anti -Dumping Agreement in failing to determine the 
profit cap  and ensure that the profit amount  established by the EU authorities does not exceed 
such a cap . We concluded that the European Union also acted inconsistently with Article 2.2 of the 
Anti-Dumping Agreement as a result of failing to determine the profit cap.  We reject, however, 
Indonesia's request that we find that the European Union  additionally acted inconsistently with 
Article 2.2.2(iii) because the European Union failed to determine the amount f or profit based on a 
"reasonable method " within the meaning of  Article 2.2.2(ii i) of the Anti -Dumping Agreement . 
7.5  Whether the European Union constructed the export price  inconsistently with 
Article s 2.3 and 2.4 of the Anti-Dumping Agreement  
7.5.1   Introduction  
7.102.   Indonesia claims that the European Union acted inconsistently with Article 2.3 and the 
fourth and fifth sentences of Article 2.4 of the A nti-Dumping Agreement  by failing to construct the 
export price  of one Indonesian exporting producer , P.T. Musim Mas, on th e basis of the price at 
which the imported biodiesel produced by P.T. Musim Mas  was first resold to independent buyers 
in the European Union.  In particular, Indonesia asserts that the EU investigating authorities 
improperly failed to include in th at first independent resale pric e the additional amount  – or 
premium  – that was paid by clients to the related importer to P.T. Musim Mas, [[ ***]]. The 
European Union argues that the premium does not form part of the price at which the imported 
biodiesel was fi rst resold to an independent buyer . 
                                                
209 Indonesia's second written submission, para. 72 ; response to Panel question No. 75, paras. 47 -48. 
210 In EU – Biodiesel  (Argentina) , Argentina argued that the 11% profit figure used by the investigating 
authority in the present investigation to calculate the injury elimination level would have been appropriate 
because it reflects similar levels of development between the Argentine and  EU industries. (Panel Report, EU – 
Biodiesel (Argentina) , para. 7.320 ). 
211 Panel Report, EU – Biodiesel (Argentina) , para. 7.350.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  7.5.2   The EU authorities' construction  of the export price for P.T. Musim Mas  
7.103.   We begin by recalling the relevant facts  related to the European Union's determination of 
an export price for P.T. Musim Mas. Under the mandatory biodie sel blending regulatory framework 
of certain EU member states, palm fatty acid distillate ( PFAD)-based biodiesel is eligible to be 
"double counted" for the purpose of compliance with EU mandatory biodiesel blending targets. This 
means that the contribution  made by PFAD biodiesel is recognized to be twice that made by other 
types of biodiesel or biofuels. Because of this, producers are only required to use half as much 
PFAD biodiesel when blending with mineral diesel to comply with EU mandatory biodiesel ble nding 
targets. Customers are willing to pay more for PFAD biodiesels as a result, and hence, a producer 
is able to charge a premium to the client.212 As relevant to Indonesia's claim in this dispute, 
biodiesel may only be "double counted" in Italy subject to  the issuance of a certificate by the 
Italian government confirming that the biodiesel is eligible for double counting.213 
7.104.   In the investigation into biodiesel imports from Indonesia, the EU authorities concluded 
that there was a "national practice"214 that cli ents purchasing PFAD biodiesel eligible for double 
counting would only  pay the additional amount or premium for such biodiesel upon issuance of the 
certificate by the Italian government confirming the eligibility of the biodiesel for double counting. 
Upon receipt of such a certificate, the related importer would send a separate invoice to the client 
for payment of the outstanding premium to the related importer.215 Evidence on the Panel's record 
confirms this practice.216 Indonesia has also argued in this proce eding that, once customers 
became familiar with the operation of the double counting scheme, the  invoice contained a single 
price that reflect ed the fact that PFAD biodiesel was eligible for double counting .217  
7.105.   In the Provisional Regulation, the EU authorit ies determined that the additional amount or 
premium that was paid by the client to P.T. Musim Mas' related importer [[ ***]] did not form part 
of the price  for resale to the first independent customer .218 The EU authorities consider ed that: 
Such premiums are  not linked to the product concerned as such, but rather to the 
provision of documents by the related importer in order to obtain a government 
certificate which enables the related importer's client to fulfil the necessary conditions 
to blend only half the  biodiesel quantity (given that this biodiesel can be counted 
'double').219 
7.106.   In its comments on the Provisional Disclosure, P.T. Musim Mas objected to the exclusion of  
the double counting premium  from the first independent resale price .220 In the Definitive 
Regulation , the EU authorities maintained their decision that the premium paid for PFAD biodiesel 
did not form part of  the export price , explain ing that, even if it considered the premium as part of 
the export price, the premium would in any event have to be deducted again " in order to compare 
the export price with the same normal value with due account taken for differences that affect 
price comparability ".221 
                                                
212 Provisional Regulation, (Exhibit IDN -1), fn 1. 
213 Provisional Regulation, (Exhibit IDN -1), fn 1. 
214 Provisional Regulation, (Exhibit IDN -1), fn 1 . 
215 Provisional Regulation, (Exhibit IDN -1), recital 69.  
216 Supplementary Agreement between [[***]]  and [[***]]  on the sale of biodiesel (30 March 2012) , 
(Exhibit IDN -32 (English translation)  (BCI) ). 
217 Indonesia 's second written submission, para. 103 (referring to Contract between [[***]] and [[***]]  
on the sale of Biodiesel (7 March 2014) , (Exhibit IDN -33 (English translation)  (BCI) )). See also Indonesia's 
response to Panel question No. 77, para. 53 (referring t o Contracts between [[***]]  and [[***]]  on the sale of 
Biodiesel ( 24 October  2014) , and between [[***]]  and [[***]] on the sale of Biodiesel (6  March 2014) , 
(Exhibit IDN -35 (English translation) (BCI)).  
218 Provisional Regulation, (Exhibit IDN -1), recital 69. 
219 Provisional Regulation, (Exhibit IDN -1), recital 69.  
220 P.T. Musim Mas, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -18 (BCI)) , p. 4. 
221 Definitive Regulation, (Exhibit IDN -2), recital 100. Article 2(10)(k) of the EU Basic Regulation 
implements aspects of Article 2.4 of the Anti-Dumping  Agreement that address differences which affect price 
comparability. Under Article 2.4, an investigator is permitted to make due allowance for differences which 
affect price comparability, including dif ferences in conditions and terms of sale, taxation, levels of trade, 
quantities, physical characteristics, and any other differences which are also demonstrated to affect price 
comparability.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  7.5.3   Whether the European Union properly excluded the double counting premium 
from  the price at which th e imported biodiesel was first resold to independent buyers in 
the European Union  
7.107.   Indonesia's challenge with respect to the construct ion of  the export price of P.T . Musim  
Mas raises a single  issue: whether the additional premium paid to P.T. Musim Mas' rel ated 
importer [IMBI] for PFAD biodiesel , forms part of the price at which the imported biodiesel was 
first resold to an independent buyer  for purposes of Article 2.3 of the Anti -Dumping Agreement . 
7.108.   Article 2.3 of the Anti-Dumping Agreement provides : 
In case s where there is no export price or where it appears to the authorities 
concerned that the export price is unreliable because of association or a compensatory 
arrangement between the exporter and the importer or a third party, the export price 
may be const ructed on the basis of the price at which the imported products are first 
resold to an independent buyer, or if the products are not resold to an independent 
buyer, or not resold in the condition as imported, on such reasonable basis as the 
authorities may  determine.  
7.109.   Indonesia submits that the language in Article 2.3 makes clear that the price charged to 
the first independent buyer is the starting point for the construction of an export price.222 In 
Indonesia's view, the term "price"  in Article 2.3  refers to  the sum of money for which a n article or 
item is sold.  Indonesia submits that Article 2.3 does not contain any  requirements or qualifications 
to the general rule that the price at which the imported products are first resold to an independent 
buyer should  be used as the starting point for the construction of export price. For instance, 
Indonesia notes that Article 2.3 does not specify that the price at which a product is first resold to 
an independent buyer must be included in one invoice and be payable in one instance  or free from 
any contingent conditions.223  
7.110.   Indonesia emphasizes  that Italian customers contractually agreed to pay the premium and 
were willing to pay a higher price for the biodiesel sold because it was eligible for double counting . 
In Indonesia's view, this  demonstrates that the premium is intrinsically linked to the product being 
sold, contrary to the determination made by the investigating authority .224 Indonesia submits that 
this link is confirmed  in contractual agreements between P.T. Musim Mas' related importer [[ ***]] 
and its customers.225  
7.111.   The European Union does not dispute  that the export price should  be constructed on the 
basis of the price at which the imported product is first resold to an independent buyer.226 
However, t he European Union is of the view  that the premium has no link to the product 
concerned  and is  therefore  not part of the price charged to the first independent buyer.  The 
                                                
222 Indonesia's first written submission, para. 206  (referring to Panel Report, US – Stainless Steel 
(Korea) , para. 6.91) . 
223 Indonesia's first written submission, para. 207. Indonesia submits that the mere fact that the 
payment of part of the price is contingent on the presentation of certain documents does not mean that  the 
price should be decreased by the amount of the premium for purposes of Article 2.3 of the Anti -Dumping 
Agreement. Rather, in Indonesia's view, the contingency is simply a modality of the payment. (Indonesia's 
first written submission, para. 213 ). 
224 Indonesia's first written submission, paras. 210 -211 and 213.  
225 Indonesia's second written submission, para. 102 (referring, for example, to Supplementary 
Agreement between [[***]]  and [[***]]  on the sale of biodiesel (30 March 2012) , (Exhibit IDN -32 (Englis h 
translation)  (BCI) )). 
226 European Union's response to Panel question No. 26, para. 45 ("The question here is what is the 
'price at which the imported products are first resold' within the meaning of Article 2.3 .") See also response to 
Panel question No. 3 2, para. 51 ("The relevant legal standard for the purposes of this claim is in Article 2.3: 
'the price at which the imported products are first resold'.") In the Specific Provisional Disclosure provided to 
[[***]], the EU authorities explained that "[t]he double counting allowance  was not considered part of the 
export price." (Specific Provisional Disclosure for [[ ***]], annex 2 A , (Exhibit IDN -19 (BCI)) , p. 4 (emphasis 
added) ). Indonesia maintains that the use of the term "allowance" by the EU authorities does not mean that 
that the EU authorities treated the premium as an "allowance" within the meaning of Article 2.4 of the Anti -
Dumping Agreement. According to Indonesia, the pr emium was reported in the initial sales MS Exce l table of 
[[***]] as an "allowance", and was subsequently reported by the EU authorities as an "allowance" due to the 
formatting of the European Commissions' MS Excel data table. (Indonesia's first written su bmission, fn 138 ). 
The European Union has not contested this point.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  European Union argues that Article 2.3 concerns  the price that pertains to what is imp orted and 
what is resold, which is the product. The premium is not imported or resold.227 According to the 
European Union, t he fact that Italian customers  contractually agreed and  were willing to pay the 
premium , or the fact that the premium was anticipated revenue to P.T. Musim Mas does not 
establish that the premium is part of the price.228  
7.112.   Article 2.3  of the Anti -Dumping Agreement  authorizes a Member to construct the export 
price where, inter alia , the actual export price is unreliable because of associatio n between the 
exporter and importer.229 The plain language of Article 2.3 makes clear that "the price charged to 
the first independent buyer is a starting -point for the construction of an export price".230 
Article 2.3 does not itself contain any guidance regar ding the methodology to be employed in order 
to construct the export price. The only rules governing the methodology for construction of an 
export price are set forth in Article 2.4 , which provides that "[i]n the cases referred to in 
paragraph  3, allowance s for costs, including duties and taxes, incurred between importation and 
resale, and for profits accruing, should also be made".231 The panel in US – Stainless Steel (Korea) 
found that this sentence authorizes the only allowances that can be made.232 After determining the 
price charged to the first independent buyer, an investigating authority would then work 
"backwards from the price at which the imported products are first resold to an independent 
buyer".233 
7.113.   There is no dispute that customers purchasi ng the biodiesel from P.T. Musim Mas' related 
importer [[ ***]] are the first independent buyers. The sole issue is whether the premium that the 
customer pays to P.T. Musim Mas' related importer [[ ***]] is properly considered as part of the 
price that is ch arged to first independent buyers.  
7.114.   There is no prior guidance on the interpretation of the term "price " as it appears  in the 
phrase  "the price  at which the imported products are first resold to an independent buyer" in 
Article 2.3  of the Anti -Dumping Agree ment. The Shorter Oxford English Dictionary defines the term 
"price" as "the sum in money or goods for which a thing is or may be bought or sold, or a thing or 
person ransomed or redeemed".234 This would suggest that the phrase "the price at which the 
import ed products are first resold to an independent buyer" refers to the sum in money for which 
the imported  product was bought or sold. There  is no further guidance regarding  the term "price". 
In our view, a s discussed in US – Stainless Steel (Korea) , the lang uage "first resold" relates to the 
price being the starting point for the construction of the export price, from which an investigating 
authority would work "backwards" to construct an export price that would have been paid by the 
related importer had the sale been made on a commercial basis.235 Accordingly, in constructing the 
export price, we consider that a Member must begin by determining the sum in money for which 
the imported  product was bought  by or sold  to an independent buyer . A member may thereafter 
make any adjustments for allowances to the extent permitted under  the fourth sentence of 
Article  2.4 of the Anti -Dumping Agreement . However,  this does not change the fact that a Member 
must begin with the price charged to the firs t independent buyer.  
7.115.   We do not agree with  the decision by the EU authorities  that the premium is not part of the 
sum in money  for which the exported product was bought by the first independent buyer.  Both 
parties accept  – as the EU authorities recognized  – that customers are willing to pay a higher price 
                                                
227 European Union's response to Panel question No. 26, para. 45.  
228 European Union's first written submission, para. 63. The European Union argues that a statement in 
a contract between two private enterprises cannot be determinative of the legal interpretation of what "price" 
means under the Anti -Dumping Agreement. (European Union's first written submission, para. 64 ). 
229 Panel Report, US – Stainless Steel (Korea) , para. 6.90.  
230 Panel Report,  US – Stainless Steel (Korea) , para. 6.91.  
231 Panel Report, US – Stainless Steel (Korea) , para. 6.91.  
232 Panel Report, US – Stainless Steel (Korea) , para. 6.94.  
233 Panel Report, US – Stainless Steel (Korea) , para. 6.99.  
234 Shorter Oxford English Dictionary , 6th edn, A. Stevenson (ed.) (Oxford University Press, 2007), 
Vol. 2, p. 2342. 
235 The panel in US – Stainless Steel (Korea)  noted that the purpose of "working backwards" from the 
price at which products are first resold to an independent buyer is to remove the  unreliability arising from 
association or a compensatory arrangement between the exporter and the importer or third party. The panel 
was referring to allowances to construct an export price contained in the fourth sentence of Article 2.4. (Panel 
Report, US – Stainless Steel (Korea) , para. 6.99 ). WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  for the PFAD biodiesel eligible for double counting .236 This is because of its particular physical 
properties which make it eligible for double counting. The parties  additionally  agree that the 
premium amount  is determined by market factors and equals the increased amount that 
customers are willing to pay for double counting -eligible biodiesel.237 Customers are willing to pay 
a premium  precisely because  they are permitted to use half as much PFAD -based biodiesel when 
blending with mineral diesel. If the product did not qualify for the certificate and was ineligible for 
double counting  because of its physical characteristics, the additional  premium would not be paid.  
7.116.   The European Union argues that there is a price for the product and a separate price for 
the premium, and additionally emphasizes that it is the product which is imported and resold while 
the premium is neither imported nor resold.238 First, the  very notion that there is a price for the 
product and a price for the premium is misconceived. The premium represents an additional 
amount that the customer is willing to pay for the specific type and quantity of PFAD -based 
biodiesel that is eligible for double counting. The customer attributes the additional value to the 
fact that the biodiesel is eligible for double counting because of its particular physical properties. In 
the abstract, the premium is not anything additional that is being purchased. The refore, it makes 
no sense to refer to the premium as having its own price. The fact that the premium is not 
imported also does not have any bearing on whether it may be considered part of the price at 
which the product is first resold.  Similarly, the premi um cannot be resold as it is simply a 
component of the price that is paid for the product.  
7.117.   The European Union has described the premium as a "distinct element" that is provided for 
separately in the contract and is paid in a different invoice.239 The Europea n Union has also argued 
that the premium has no link to the product concerned but rather, is linked to the provision of 
documents.240 A 2011 sales contract submitted by Indonesia as evidence in this proceeding 
confirms  that the  premium was , initially at leas t, paid in a separate invoice upon receipt of a 
certificate confirming the eligibility of the PFAD biodiesel for double counting.241 In addition,  the 
provided contract indicates that  P.T. Musim Mas' related importer [[ ***]] provided documentation  
to the buye r to request the certificate .242 We do not in any event consider it relevant that the 
amount of the premium may be paid separately in a different invoice  or that documentation was 
provided that would enable the buyer to confirm the eligibility of the particu lar imported biodiesel 
for double counting . As we explained above, there is no guidance  in Article 2.3 that require s that  
the price is paid in a single transaction or is reflected in a single invoice.243 We also do not see how 
documentation confirming the physical properties or authenticity of a product  means that the 
premium is not paid in exchange for the imported product.  
7.118.   We note the possibility exists that the certificate may not be granted if the biodiesel is 
found to be ineligible for double counting.  As a factual matter, there is no evidence that this has 
occurred. In any event, the possibility that the certificate may not be granted has no bearing on 
our conclusion that, in cases where the premium is paid for PFAD biodiesel , the premium should be 
considered as part of the price at which the product is first resold. We do not see any  incoherence 
in the view that the premium forms part of the price at which the produc t is first resold in any case 
the premium is paid, but does not form part of the price if it is not actually paid.   
                                                
236 Definitive Regulation, (Exhibit IDN -2), recital 176 ("In fact data shows that double counting biodiesel 
has a small price premium over virgin biodiesel, the price of which is linked to mineral diesel.")  
237 Indonesia's response to Panel question No. 25, para. 41; European Union's response to Panel 
question No. 25, para. 44; and Provisional Regulation, (Exhibit IDN -1), recital 69.  
238 European Union's response to Panel question No. 26, para. 45.  
239 European Union's second written submission, para. 45.  
240 European Union's first written submission, para. 65.  
241 Supplementary Agreement between [[ ***]] and [[***]] on the sale of biodiesel (30 March 2012) , 
(Exhibit IDN -32 (English translation)  (BCI) ), recitals 1 -4. 
242 Supplementary Agreement between [[ ***]] and [[***]] on the sale of biodiesel (30 March 2012) , 
(Exhibit IDN -32 (English translation)  (BCI) ), recitals 1 -4. 
243 We note that Indonesia has also submitted several 2014 sales contracts as evidence, ind icating that 
certain customers were willing to make payment for PFAD biodiesel and the premium in a single invoice. In our 
view, this supports Indonesia's contention that customers had become familiar with the operation of the double 
counting scheme and th e eligibility of PFAD biodiesel to qualify for the certificate, and thus were willing to pay 
the full amount for the double counting -eligible biodiesel and the premium in the same invoice. (Contract 
between [[ ***]] and [[ ***]] on the sale of Biodiesel (7 M arch 2014) , (Exhibit  IDN-33 (English translation)  
(BCI) ); Contracts between [[***]] and [[***]] on the sale of Biodiesel (24 October 2014), and between 
[[***]] and [[***]] on the sale of Biodiesel (6 March 2014) , (Exhibit IDN -35 (English translation) (BCI)) ; see 
also Indonesia's second written submission, para. 103 ). WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  7.119.   For the foregoing reasons , we therefore find that  Indonesia  has made a prima facie  case 
that the European Union acted inconsistently with Article 2.3 of the Anti -Dumping Agreement by 
failing to include the double counting premi um as part of the price at which imported biodiesel 
produced by P.T. Musim Mas was first resold to an independent buyer within the meaning of that 
provision. In light of this finding , we are not required to address additional  arguments of Indonesia 
or the European Union  regarding the relevance of the rules contained in  the third and 
fourth  sentences  of Article 2.4  of the Anti -Dumping Agreement  or rules regarding differences 
affecting price comparability contained elsewhere in Article 2.4.244  
7.5.4   Conclusions  
7.120.   As indicated above, we consider  that the price charged to the first independent buyer is 
the starting -point for the construction of an export price  under Article 2.3 of the Anti -Dumping 
Agreement . In constructing the export price, we consider that a Member  must begin by 
determining the sum in money for which the imported  product was bought by or sold to an 
independent buyer. There is no further guidance to the term price in Article 2.3 relating to the 
price of products first resold to an independent buyer. On this basis, we consider that the premium 
that the customer pays to P.T. Musim Mas' related importer [[ ***]] is properly considered as part 
of the price that is charged to first independent buyers. Therefore, we find that Indonesia has 
established  that the European Union acted inconsistently with Article 2.3 of the Anti -Dumping 
Agreement by failing to include the double counting premium as part of the price at which 
imported biodiesel produced by P.T. Musim Mas was first resold to an independent buyer wit hin the 
meaning of that provision . 
7.6  Whether the European Union's consideration of price effects was consistent with 
Articles 3.1 and 3.2 of the Anti -Dumping Agreement   
7.6.1   Introduction  
7.121.   Indonesia claims that the EU authorities' consideration of the price effects  of dumped 
imports is inconsistent with Articles 3.1 and 3.2 of the Anti -Dumping Agreement. Indonesia raises 
two main claims245: 
a. the EU authorities failed to ensure price comparability between imported and domestic 
biodiesel, by relying on low volume sales o f cold filter plugging point ( CFPP) 13 degrees 
centigrade  biodiesel produced by the EU industry in calculating an adjustment to the 
price of Indonesian imports; and  
b. the EU authorities failed to establish the existence of significant price undercutting by 
failing : (i) to take into account noticeable differences between imported and domestic 
biodiesel ; and (ii) to examine the significance of price undercutting with regard to the 
majority of the EU industry's sales.  
7.6.2   The EU authorities' consideration of the ef fect of dumped imports on the price of 
biodiesel sold in the domestic market  
7.122.   We begin by setting out the relevant facts concerning the EU authorities' price 
undercutting analysis. The EU authorities indicated that they would examine th e effects of the 
imports from Argentina and Indonesia cumulatively  for purposes of the injury analysis.246 Despite 
the cumulative assessment, the price undercutting calculations were made separately for 
                                                
244 The European Union has argued, for instance, that the premium paid for double counting biodiesel 
only results because of intervention by the Italian government . The European Union argues  that state 
intervention of this type that creates special or exclusive rights and is specifically designed to encourage one 
type of activity is functionally equivalent to a decision to impose a tax, or "is in the nature o f a negative tax". 
The European  Union argues that the purpose of the first three sentences of Article 2.4 of the Anti -Dumping 
Agreement is to address state interventions like the double counting regime, and hence, the premium would in 
any event need to be deducted under these parts of Arti cle 2.4. The European Union additionally emphasizes 
that there is no double  counting premium scheme present in Indonesia. (European Union's first written 
submission, para s. 67-69 and 72; response to Panel question No. 36, para. 53; and second written submi ssion, 
paras. 44, 46 -48, and 51 ). 
245 Indonesia's first written submission, para. 223; second written submission, para. 114.  
246 Provisional Regulation, (Exhibit IDN -1), recital 90.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  Argentina and Indonesia, due to the product differences between biodiese l produced by these 
countries. The comparison between imported and domestic biodiesel was made based on the CFPP, 
which is the temperature at which the biodiesel turns back into fat and cannot be used as fuel.247 
The biodiesel produced in Indonesia and sold to the EU market was mostly  "palm methyl ester" 
(PME)  with a CFPP level of 13 degrees centigrade (hereinafter "CFPP 13 biodiesel" or "PME"). T he 
biodiesel from Argentina w as exclusively "soybean methyl ester" (SME)  with a CFPP level of zero 
degrees centigr ade.248 While SME and PME can be used in certain environments in their pure form, 
they are nearly always blended with "rapeseed methyl ester" (RME), which has a lower CFPP, 
before being used in the European Union.249 
7.123.   The EU industry produced biodiesel composed  from different feedstocks, mainly from 
rapeseed (RME), but also from other feedstocks, including palm oil, waste , and virgin oils.250 The 
EU industry blended several feedstocks together to produce the final biodiesel that was sold to 
customers.251 The EU indu stry sold blended biodiesel at various CFPP levels, but mainly at a CFPP 
level of zero degrees centigrade (CFPP 0) and below.252 In the price undercutting calculations, the 
EU authorities compared the price of PME from Indonesia and SME from Argentina to the  price of 
blended CFPP  0 biodiesel sold by the EU industry (hereinafter "blended CFPP 0 biodiesel"). CFPP  0 
biodiesel is a blend of different biodiesels. The EU industry used both its own production of 
biodiesel and imported biodiesel when producing blende d CFPP 0 biodiesel. The EU authorities 
excluded blended CFPP 0  biodiesel  made using imported biodiesel from their price undercutting 
calculations.253  
7.124.   Since Argentina exported SME with CFPP  0 to the EU market, the EU authorities compared 
prices of Argentine SME directly to the domestic sales of blended CFPP  0 biodiesel.254 Indonesia 
mainly exported CFPP 13 biodiesel to the European Union.255 Given that the volume of sales of 
domestically -produced CFPP 13 biodiesel was very low, the EU  authorities considered that a direct 
comparison between imported and domestic CFPP 13 biodiesel was not "reasonable".256 The 
EU authorities therefore compared Indonesian imports with blended CFPP  0 biodiesel produced by 
the EU industry. In order to compare CFPP 13 biodiesel from Indone sia to blended CFPP 0 biodiesel 
from the European Union, the EU authorities made an adjustment to account for the different CFPP 
levels between the compared products. The EU authorities calculated this adjustment by taking the 
price difference between the EU industry's sales of blended CFPP 0 biodiesel and the EU industry's 
sales of CFPP 13 biodiesel, and then adding that amount to the price of Indonesian biodiesel.257 As 
a result, the price of Indonesian PME was adjusted upwards by 17.35%, to construct what the 
                                                
247 Provisional Regulation, (Exhibit IDN -1), recital 94.  
248 Provisional Regulatio n, (Exhibit IDN -1), recital 30.  
249 The EU authorities also indicated that SME is blended with PME, because SME in its pure form does 
not meet the European standard EN 14214 as regards iodine and cetane numbers . (Provisional Regulation, 
(Exhibit IDN -1), recital 32).  
250 Provisional Regulation, (Exhibit IDN -1), recital 30; Definitive Regulation,  (Exhibit IDN -2), recitals 18 
and 117.  
251 Definitive Regulation, (Exhibit IDN -2), recital 123.  This recital reads:  
Unlike the exporting producers in Argentina and Indonesi a, the Union industry does not sell 
biodiesel made from one feedstock, but blends several feedstocks together to produce the final 
biodiesel that is sold.  
252 European Union's second written submission, para. 57.  
253 Definitive Regulation, (Exhibit IDN -2), recitals 121 and 128; European Union's first written 
submission, para. 92.  
254 In EU – Biodiesel (Argentina) , Argentina did not submit any claims with regard to the EU 
authorities'  consideration of price undercutting. Argentina challenged other aspects of the injury determination, 
in particular the evaluation of certain injury factors under Article 3.4 (production capacity and capacity 
utilization) and the examination of the other factors causing injury to the domestic industry under Article 3.5 
(overcapacity, EU industry' imports of product concerned, double  counting  regimes in some EU Member States , 
lack of vertical integration , and access to raw materials). (Panel Report, EU – Biodiesel (Argentina) , 
paras.  7.368 -7.529; Appellate Body Report, EU – Biodiesel (A rgentina) , paras. 6.114 -6.148).  
255 Indonesia clarifies that around 19% of PME imports from Indonesia had CFPP levels other than 
CFPP 13, ranging between CFPP 7 and CFPP 17 . (Indonesia's second written submission, para. 131).  
256 Provisional Regulation, (Exhi bit IDN -1), recital 96.  
257 Provisional Regulation, (Exhibit IDN -1), recital 96; Definitive Regulation, (Exhibit IDN -2), recital 124.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  price of imports of CFPP 0 biodiesel from Indonesia would have been.258 The price was then 
compared to the price of blended CFPP 0 biodiesel sold by the EU industry.  
7.125.   In the Provisional Regulation, the EU authorities explained this methodology as follows :  
All sales from Argentina to the EU were at a CFPP of 0 degrees centigrade. These sales 
were therefore compared to the sales of Union producers of biodiesel at a CFPP of 0.  
All sales from Indonesia to the EU were at a CFPP of 13 degrees centigrade. Given  the 
very small volume of sales of Union producers at this CFPP  – since PME from 
Indonesia is almost always blended with other biodiesel from other sources before 
being sold to the first independent customer  – a direct comparison was not considered 
reasona ble. The export price of the PME from Indonesia at CFPP 13 was therefore 
adjusted upwards to a price at CFPP 0 by taking the difference in price on the Union 
market between the sales of PME at CFPP 13 manufactured by the Union industry and 
the average pric e of biodiesel at CFPP 0.259 
7.126.   Based on the above methodology , the EU authorities considered that there was significant 
price undercutting caused by the dumped imports of biodiesel from Argentina and Indonesia as 
compared with the price of EU biodiesel.  The av erage undercutting margin for Indonesia was 4% 
during the investigation period.260 The EU authorities confirmed their findings in the Definitive 
Regulation.261 
7.6.3   Whether the adjustment made by the EU authorities to the price of imports of 
Indonesian biodiesel wa s flawed  
7.127.   Indonesia first claims that the European Union acted incon sistently with Articles 3.1 
and 3.2 of the Anti -Dumping Agreement by failing to ensure price comparability between imported 
and domestic biodiesel in terms of differences in quantities. Indonesia contends that the 
EU authorities failed to account for the low volume of sales of CFPP 13 biodiesel produced by the 
EU industry in calculating an adjustment to the price of Indonesian imports.  
7.128.   Article 3.1 of the Anti -Dumping Agreement sets out the basic principles that a 
determination of injury shall be based on positive evidence and involve an objective examination. 
It reads as follows:  
A determination of injury for purposes of Article VI of GATT 1994 shall be based on 
positive evidence and involve  an objective examination of both (a) the volume of the 
dumped imports and the effect of the dumped imports on prices in the domestic 
market for like products, and (b) the consequent impact of these imports on domestic 
producers of such products.  
7.129.   The second sentence of Article  3.2 provides more specific guidance regarding  the objective 
examination of the effect of dumped imports on prices in the domestic market. It provides:  
With regard to the effect of the dumped imports on prices, the investigating 
authorities shall consider whether there has been a significant price undercutting by 
the dumped imports as compared with the price of a like product of the importing 
Member, or whether the effect of such imports is otherwise to depress prices to a 
signific ant degree or prevent price increases, which otherwise would have occurred, to 
a significant degree.  No one or several of these factors can necessarily give decisive 
guidance.  
7.130.   Indonesia argues that the adjustment to the price of CFPP 13 biodiesel imports d id not 
resolve the issue of the lack of comparability in terms of volume differences, and is therefore 
                                                
258 Indonesia's first written submission, para. 226(b) (referring to Specific Provisional Disclosure for the 
Wilmar Group, annex 8, (Exhibit IDN -20), p. 1) ; European Union's response to Indonesia's question No. 2, 
paras.  2-3. 
259 Provisional Regulation, (Exhibit IDN -1), recitals 95 -96.  
260 Provisional Regulation, (Exhibit IDN -1), recitals 97 and 126.  
261 Definitive Regulation, (Exhib it IDN -2), recitals 121 -129 and 147.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  inconsistent with Articles 3.1 and 3.2 of the Anti -Dumping Agreement. Indonesia refers to the 
EU authorities' conclusion that a direct comparison between  Indonesian imports and EU sales of 
CFPP 13 "was not considered reasonable" given the "very small volume of sales" of EU -produced 
CFPP 13 biodiesel.262 According to Indonesia, based on this statement, the EU authorities found 
that the EU industry's price of CFPP 13 biodiesel was "not comparable"263 to Indonesian CFPP 13 
biodiesel due to significant differences in volumes and therefore that the price was "unreliable"264 
for the purpose of price effects analysis.265 Indonesia argues that, if the sales price of the 
EU producers' CFPP 13 biodiesel is non -comparable for a direct comparison, then EU sales of 
CFPP 13 are also non -comparable for calculating the price adjustment (to address different CFPP 
levels).266 Indonesia underlines that the volume difference between CFPP  13 biodiesel 
(6,300  tonnes ) and blended CFPP 0 biodiesel ( 993,860 tonnes ) produced by the EU  industry that 
was used for calculating the adjustment is nearly the same as the volume difference between 
Indonesian CFPP 13 biodiesel ( 995,663 tonnes ) and EU -produced CFPP 13 biodiesel ( 6,300  tonnes ) 
that was rejected for the purpose of a direct comparison.267 Accordingly, Indonesia argues that the 
EU authorities failed to properly consider differences in quantities  when making the price 
adjustment to account for ph ysical differences between CFPP 13 biodiesel and blended CFPP 0 
biodiesel. The result was a distorted calculation of the price adjustment, which undermined the 
accuracy of the price undercutting margin that was calculated.268 
7.131.   The European Union denies that t he EU authorities found the price of EU industry's sales of 
CFPP 13 biodiesel was "unreliable" in the way Indonesia argues. Rather, a direct comparison 
between Indonesian and EU biodiesel at CFPP 13 was not considered "reasonable"269 or 
"representative"270 due to a very small volume of EU industry's sales at this CFPP "from the total of 
all biodiesel made and sold by the EU industry".271 The European Union notes that the EU industry 
did not sell biodiesel made from one feedstock, but blended several feedstocks to gether to produce 
the final biodiesel that was sold to customers.272 The EU authorities therefore compared the price 
of CFPP  13 biodiesel from Indonesia to the price of blended CFP P 0 biodiesel from the 
European  Union, which had the highest share of domestic  sales.273 In particular, the sales of 
blended CFPP 0 biodiesel amounted to 993,860 tonnes, which represented 37% of the sales of the 
EU sampled producers, while other sales were mainly at lower CFPP levels.274 The European Union 
submits that in order to ensure price comparability at CFPP 0, the export price of CFPP  13 biodiesel 
from Indonesia was adjusted upwards to a price at CFPP 0 biodiesel.275 The European Union argues 
that this adjustment was calculated on t he basis of transactions of similar volumes.276  
7.132.   Article 3.1 or 3.2 of the Anti -Dumping Agreement do not provide any specific guidance as 
to how an investigating authority should make adjustments for price comparability in the context 
of injury determination . This stands in contrast to Article 2.4 of the Anti -Dumping Agreement that 
provides specific guidance in respect of allowances to be made to ensure price comparability 
between the export price and the normal value in the context of dumping determination. For 
purposes of Article 3.2, previous panels have noted that price comparability can be ensured, for 
instance, by carefully defining product categories for the collection of price information or by 
making adjustments to prices as warranted by the factual c ircumstances of the case.277 In light of 
our standard of review, the question before us is whether the EU authorities' calculation of the 
                                                
262 Indonesia's first written submission, para. 245.  
263 Indonesia's first written submission, paras. 246  and 248-249; second written submission, 
paras. 115, 118 -120, and 125-126. 
264 Indonesia's first written submission, paras. 246  and 248-249. 
265 Indonesia's first written submission, para. 246.  
266 Indonesia's first written submission, paras. 248 -249. 
267 Indonesia's second written submission, para s. 115-116 and 118; o pening statement at the 
second  meeting of the Panel, para . 60.   
268 Indonesia's first written submission, paras. 250 and 254; second written submission, para. 122.  
269 Provisional Regulation, (Exhibit IDN -1), recital 96.  
270 European Union's first written submission, para. 86.  
271 European Union's response  to Panel question No. 88, para. 41.  
272 European Union's first written submission, para. 82; response to Panel question No. 95, para. 54 
(referring to Definitive Regulation, (Exhibit IDN -2), recital 123) .  
273 European Union's second w ritten submission, para. 57; response to Panel question No. 88, para. 41.  
274 European Union's second written submission, para s. 56-57. 
275 European Union's first written submission, para. 94.  
276 European Union's first written submission, para. 95 (referring to  Definitive Regulation, 
(Exhibit  IDN-2), recital 124 ). 
277 Panel Reports, EC – Fasteners (China) , para. 7.328 ; China – X-Ray Equipment , para. 7.51.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  adjustment to account for different CFPP levels of Indonesian and EU biodiesel, in the context of its 
overall price unde rcutting analysis, was reasonable and objective.  
7.133.   As noted above, the EU authorities considered that a direct comparison between CFPP 13  
biodiesel  from Indonesia and CFPP  13 biodiesel made by the EU industry could not be made 
because of "very small volumes  of sales" by the EU  industry at this CFPP level. The European 
Union explained that CFPP 13 biodiesel constituted a small share of all biodie sel sold and produced 
by the EU  industry.278 The EU sampled producers sold 6,300 tonnes  of CFPP  13 biodiesel during 
the investigation period, which constituted 0.23% of total sales of the EU sampled producers 
during the investigation period.279 The low volumes of CFPP 13 sales thus represented a miniscule 
proportion of EU industry sales, which would not provide a robust ba sis for the price effects 
analysis. This would mean that the price comparison and the analysis of the effect of the imports 
would not have taken into account the vast majority (99.77%) of EU industry's sales. Such a 
comparison to such a small share of the EU industry's sales would not provide a reasonable picture 
of the effect of the dumped imports on the prices of the domestic like product to establish the 
existence of significant price undercutting, as required by Article 3.2.280 It would not seem 
unreasona ble that the EU authorities instead decided to compare the price of Indonesian imports 
to the EU industry's price of blended CFPP 0 biodiesel, which represented 37% of EU industry's 
sales ( 993,860 tonnes ) during the investigation period. The European Union  has specified that 
sales of blended CFPP 0 biodiesel  represented the largest share of any of the types of biodiesel 
sold in the European Union by volume.281  
7.134.   We disagree with Indonesia that the EU authorities' decision not to make a direct 
comparison betwee n imported and domestic CFPP 13 biodiesel rendered the price of CFPP 13 
biodiesel produced by the EU industry to be "unreliable" or "non -comparable" .282 As we explain 
above, sales of 6,300 tonnes  of CFPP  13 biodiesel produced by the EU industry during the 
investigation period constituted 0.23% of total sales of the EU sampled producers during the 
investigation period. The European Union has explained that it was not considered reasonable to 
base the price comparison on such a low percentage of sales by the EU  industry, i.e. a low overall 
proportion of the EU industry's sales. We see no evidence on the record that the EU authorities 
considered  that the price of CFPP  13 biodiesel was in any way unusable due to a large difference in 
volumes. Even though the EU au thorities did not use the price of CFPP  13 biodiesel for the purpose 
of a direct comparison with Indonesian imports, this data was part of the record before the EU 
authorities. We do not find it unreasonable that the EU authorities relied on this data for a different 
purpose, i.e. to establish an adjustment factor to the price of CFPP 13 biodiesel from Indonesia in 
order to bring it to a CFPP level of 0.   
7.135.   We note that the EU authorities looked into the difference in quantities between sales of 
CFPP 13 biodi esel and blended CFPP 0 biodiesel  made by the EU industry  in the context of making 
the price adjustment.  In particular, the EU authorities examined the quantities per transactions of 
sales of CFPP 0 biodiesel manufactured and blended in the European Union  as compared to sales 
transactions of CFPP  13 biodiesel . In recital 124 of the Definitive Regulation, the EU authorities 
explained as follows:  
For imports from Indonesia, which are at a CFPP of 13 or above, an adjustment was 
made, being the difference in p rice between the Union industry's sales of CFPP 13 and 
the Union industry's sales of CFPP 0, in order to compare the CFPP 13 and above from 
                                                
278 Recital 96 of the Provisional Regulation notes that "PME from Indonesia is almost always blended 
with other biodiesel from other sources before being sold to the first independent customer". The Panel asked 
the European Union whether the decision not to make a direct comparison was strictly due to low volume of 
sales of CFPP 13 biodiesel or also to address the i ssue of blending. The European Union replied that the 
adjustment was made due to the low percentage of CFPP 13 biodiesel made and sold by the EU industry from 
the total of all biodiesel made and sold by the EU industry. (European Union's response to Panel question 
No. 88, para.  41). 
279 European Union's response  to Indonesia's question No. 2, para. 6; Indonesia's response  to Panel 
question No. 108, para. 102.  
280 Indonesia agrees that a finding of price undercutting with respect to the EU industry's sales of 
CFPP 13 biodiesel would not have been sufficient for considering whether there has been significant  price 
undercutting by the dumped imports from Indonesia. (Indonesia's second written submission, para. 124).  
281 European Union's second written submission, par a. 57.  
282 Indonesia's first written submission, paras. 246, 248 -249, and 253; second written submission, 
paras. 120  and 125-126. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  Indonesia with the CFPP 0 manufactured and blended in the Union. One Indonesian 
exporting producer noted that as the  sales of CFPP 13 by the Union industry were 
made in small quantities per transaction, that these prices should be compared to 
similar sized transactions of CFPP 0. On inspection of transactions of CFPP 0 of a 
similar quantity per transaction, the differen ce in price found was in line with the 
difference using all transactions of CFPP 0, with differences in price both above and 
below the average price difference. As a result there was no change to the level of 
price undercutting found in the provisional Reg ulation in recital 97.283 
7.136.   Following an examination of quantities per transaction,  the EU  authorities observed  that 
the difference in price remains the same regardless of the fact whether the average price was used 
based on all CFPP 0 transactions or only on the price of CFPP 0 transactions with the volume 
similar to the volume of CFPP 13 biodiesel transactions. Thus, contrary to what is suggested by 
Indonesia, the EU authorities took into account volume aspects of the sales in  the context of 
making an adjustm ent.  
7.137.   Indonesia also notes that the EU authorities should have employed the same method for 
the calculation of the adjustment on account of physical differences that was used in the prior 
investigation concerning biodiesel from the United States, which factored in the type of feedstock  
used in producing biodiesel as a basis to make price comparisons instead of focusing on CFPP.284 
The EU authorities addressed the same point raised by interested parties during the investigation, 
explaining that the method b ased on CFPP was appropriate in the present investigation, because 
the CFPP level was a determinative factor for customers  that were not concerned with the 
composition of biodiesel once the product meets a required CFPP level.285 As mentioned above, 
Articles  3.1 and 3.2 of the Anti -Dumping Agreement do not specify a methodology that must be 
followed in conducting a price effects analysis. An investigating authority enjoys a degree of 
discretion to determine the analytical methodologies that will be applied in  the course of an 
investigation, provided that such method respects the basic principles in Article  3.1 that a 
determination of injury must be based on positive evidence and involve an objective 
examination.286  
7.138.   In addition, Indonesia submits that approximat ely 19% of biodiesel imports from Indonesia 
had a CFPP level other than CFPP  13, ranging from CFPP 7 to CFPP 17  degrees centigrade . 
Indonesia submits that the EU  authorities improperly applied the adjustment calculated for 
CFPP 13 biodiesel to all biodiese l imports from Indonesia, without regard to the different prices of 
CFPP 7 to CFPP 17 varieties (other than CFPP 13 biodiesel).287 The Panel questioned the parties on 
the volumes and prices of CFPP  7 to CFPP 17 biodiesel imports. Indonesia referred to the da ta of 
two producers that sold biodiesel other than CFPP 13 and indicated that the overall price 
differential between CFPP  7 and CFPP 15  biodiesel was around [[***]] and the difference between 
CFPP 13 and CFPP  17 was [[ ***]].288 In its response, the European Union explained that sales of 
CFPP 12, CFPP 13 , and CFPP  14 collectively accounted for 94% of all biodiesel imports from 
                                                
283 Definitive Regulation, (Exhibit IDN -2), recital 124.  
284 In that investigation, the price of the respective feedstock (palm, soybean , or rapeseed oils) was 
used to calculate an allowance on account of physical differences between different types of biodiesel before a 
price comparison was made. The EU authoritie s also factored in the percentage of particular types of biodiesel 
in blended varieties to take into account all biodiesel that was imported or sold by the sampled EU producers. 
Indonesia submits that this method would have allowed to resolve the issue of difference in quantities and to 
permit the calculation of a reliable adjustment on account of physical differences.  (Indonesia's second written 
submission, paras. 134 -138; Commission Regulation (EC) No. 193/2009 of 11 March 2009 imposing a 
provisional anti -dumping duty on imports of biodiesel originating in the United States of America , 
(Exhibit  IDN-25), recital 84 ; and Council Regulation (EC) No. 599/2009 of 7 July 2009 imposing a definitive 
anti-dumping duty and collecting definitively the provisional dut y imposed on imports of biodiesel originating in 
the United States of America , (Exhibit IDN -26), recital 123).  
285 Definitive Regulation, (Exhibit IDN -2), recitals 122 -123; Indonesia's first written submission, 
para. 255 (referring to Wilmar Group, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -13 
(BCI)) , pp. 28 -29; and P.T. Pelita Agung Agrindustri, Post -Hearing Brief (30 August 2013) , (Exhibit IDN -24), 
p. 7). 
286 Panel Report s, Thailand – H-Beams , para. 7.159 ; China – Broiler Products , paras. 7.474 -7.476; 
China – X-Ray Equipment , para. 7.41; and China – Cellulose Pulp , para. 7.62 . 
287 Indonesia's second written submission, para s. 131-133; first written submission, para. 244; and 
response to Panel question No. 102 . 
288 Indonesia's response to Panel question No. 102, paras. 89 -91. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  Indonesia.289 The European  Union also noted that Indonesia had only referred to the price 
difference betwe en the lowest price biodiesel import (presumably CFPP  17) and the highest price 
import (presumably CFPP  7).290 This suggests that the price differential between CFPP 12, 
CFPP 13, and CFPP 14 would be appreciably smaller. In these circumstances, we consider t hat it 
was reasonable for the EU authorities to calculate an adjustment on the basis of CFPP 13 
considering that so few imports were at the extremes (CFPP  7 and CFPP 17) that they would have 
an insignificant impact on the overall assessment.  
7.139.   Finally, in the second written submission, Indonesia raised  additional arguments as to why 
the price s of CFPP 13 biodiesel produced by the EU industry  cannot serve  as the basis for 
calculating the adjustment to the price of imports from Indonesia . First, Indonesia subm its that 
there may be additional costs when producing CFPP 13 biodiesel  in the E uropean Union , due to the 
fact that imported CPO feedstock from Malaysia or Indonesia may need to be used in the 
production of CFPP 13 biodiesel , which may have implications fo r the price of the final product. In 
Indonesia's view, this possibility may distort the comparison between CFPP 13 biodiesel  and 
CFPP 0 biodiesel  prices.291 Second, Indonesia submits that the European Union itself acknowledged 
that the production of PME in t he European Union is uneconomical which, according to Indonesia, 
demonstrates that "the odd sale of 6,300 MT of the Union produced CFPP 13° C biodiesel is unlikely 
to be representative of the value that the customers assign to the physical differences betwe en 
PME and CFPP 0°C".292  
7.140.   We are of the view that these arguments are founded on a completely different basis from 
those adduced by Indonesia in its first written submission, in respect of its challenge to the 
adjustment, and we therefore do not consider it appropriate to make findings with regard to these 
additional arguments  that have been raised in the second written submission.  
7.141.   In the first written submission, Indonesia focused its  claim concerning  the price 
adjustment on the EU authorities' failure to account for differences in quantities. Indonesia did not 
present  any arguments in connection with  the additional costs when producing CFPP 13 biodiesel  
in the European Union . Indonesia's arguments rel ated to the presence of additional costs are  a 
completely different basis for challenging the adjustment and cannot be considered as an 
elaboration of Indonesia's arguments presented in the first written submission or a rebuttal to the 
arguments of the Eur opean Union. We recall that Paragraph 6 of the Working Procedures provides 
that each party shall present the facts of the case and its arguments in its first written submission 
in advance of the first substantive meeting of the Panel with the parties .293 Paragraph 6 of the 
Working Procedures  is an expression of the principle of due process: the complainant must make 
its case at a sufficiently early stage of the proceeding to allow the respondent sufficient time to 
defend itself. Indonesia's  additional argumen ts are based on the information provided in the 
Provisional Regulation, and we therefore consider that these arguments could have been 
articulated  in Indonesia's  first written submission.294 
7.142.   In consideration of  the above, we conclude that Indonesia  has failed to establish that the 
European Union acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping Agreement, by 
relying on prices of CFPP 13 biodiesel produced by the EU industry in calculating an adjustment to 
the price of Indonesian imports.  
                                                
289 European Union's response to Panel question No. 101, para. 57.  
290 European Union's comments on Indonesia's response to Panel question No. 102, paras. 46 -47.  
291 Indonesia's second written submission, paras. 12 8-129. 
292 Indonesia's second  written submission, para. 130. 
293 Paragraph 6 of the Panel's Working Procedures states that:  
Before the first substantive meeting of the Panel with the parties, each party shall submit a 
written submission in  which it presents the facts of the case and its arguments, in accordance 
with the timetable adopted by the Panel.  
294 In the context of  the injury determination, the EU authorities addressed the issues related to the DET 
system in their non -attribution anal ysis. In particular, the imports of biodiesel from Argentina and Indonesia 
made by the EU industry were examined as a non -attribution factor . (Provisional Regulation,  (Exhibit IDN -1), 
recitals 132 -136; Definitive Regulation,  (Exhibit IDN -2), recitals 151 -160). This issue was a subject to dispute 
in EU – Biodiesel  (Argentina) . (Panel Report, EU – Biodiesel  (Argentina) , paras. 7.473 -7.490).  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  7.6.4   Whether the EU authorities failed to take into account noticeable differences 
between imported and domestic biodiesel and to examine the significance of price 
undercutting with regard to the majority of the EU industry's sales  
7.143.   Indonesia submits that the Europe an Union acted inconsistently with Articles 3.1 and 3.2 
of the Anti -Dumping Agreement, by failing to take into account certain product differences 
between imported and domestic biodiesel as well as the majority of the EU industry's sales in its 
price under cutting analysis. Therefore, the EU authorities failed to properly consider the effect of 
the dumped imports from Indonesia on the price of the EU biodiesel.  
7.144.   Indonesia draws on the Appellate Body's interpretation of "significant price undercutting" 
to argu e that the EU authorities failed to make a "dynamic assessment" of whether the price of 
PME imports from Indonesia had any effects on the price of the blended CFPP 0 biodiesel from the 
European Union .295 Indonesia submits that the analysis fails to take into account that PME from 
Indonesia and blended CFPP 0 biodiesel from the European Union have noticeably different 
physical characteristics (different feedstock and CFPP levels), considerable price differ ences (the 
price of blended CFPP 0 biodiesel is 21% more expensive than Indonesian PME) and different 
modes of use (PME is rarely used by consumers in its pure form and must be blended with other 
types of biodiesel).296 Considering that the price comparison was made between different types of 
biodiesel, Indonesia argues that the price effects analysis should have involved a discussion of 
price substitutability, price correlation , and the degree of the impact that movement of prices of 
imported PME might have on the EU producers' sales of blended CFPP 0 biodiesel.297 Indonesia 
further argues that the EU authorities' finding of significant price undercutting is flawed because it 
is based on a comparison concerning only 37% of the EU industry's sales.298  
7.145.   The Europea n Union argues that PME from Indonesia was in competition with EU biodiesel. 
The European Union submits that imported and domestic biodiesel had similar basic physical, 
chemical, technical characteristics  and uses , and were considered to be like products.299 The 
European Union notes that during the investigation the EU authorities rejected an argument raised 
by an interested party that PME from Indonesia was not a like product to RME and other 
EU biodiesels as well as to SME from Argentina due to the higher C FPP level of PME (which 
necessitates that PME is blended with other types of biodiesel before use).300 In this respect, the 
EU authorities stated that PME is in competition with biodiesel produced in the European Union, 
which includes RME as well as biodiese l from palm oil and other feedstocks.301 The EU authorities 
considered that PME is interchangeable with biodiesel produced by the EU industry, because it can 
be used in the EU market throughout the year by blending with other biodiesels.302 The 
European  Union also refers to the EU authorities' findings that imports from Indonesia and 
Argentina are blended with mineral diesel by the same trading companies and sold to customers in 
direct competition with EU biodiesel.303  
7.146.   The European Union further submits that it was reasonable to use only sales of blended 
CFPP 0 biodiesel, which represented 37% of the EU sampled producers' sales, because blended 
CFPP 0 biodiesel was the product with the highest volume of sales of the EU industry , while other 
sales were mainly of b iodiesel with lower CFPP ratings.304 
                                                
295 Indonesia's second written submission, para. 144 (referring to Appellate Body Report s, China – 
HP-SSST (Japan) / China  – HP-SSST (EU) , para. 5.158 ).  
296 Indonesia's second written submission, paras. 146 -147; first written submission, p aras. 258 
and 269. 
297 Indonesia's second written submission, paras. 148 -151. 
298 Indonesia's second written submission, paras. 160 -168; first w ritten submission, paras. 259 -269. 
299 European Union's response to Panel question No.  90, paras. 43 -44 (referring to Provisional 
Regulation,  (Exhibit IDN -1), recital 34 ). 
300 European Union response to Panel question No. 90, para. 45 (referring to Definitive Regulation,  
(Exhibit IDN -2), recitals 17 -18). 
301 Definitive Regulation, (Exhibit IDN -2), recital 18.  
302 Definitive Regulation, (Exhibit IDN -2), recital 18.  
303 European Union's response to Panel question No.  90, para. 43 (referring to Provisional Regulation,  
(Exhibit IDN -1), recital 89 ). 
304 The European Union explained that the EU authorities "relied on 37% of the sampled producers' sales 
because sales of biodiesel of CFPP 0 were by far the most important sales of the sampled EU industry by 
volume, while other s ales were mainly at lower CFPP" . (European Union's second written submission, 
para. 57).  WT/DS480/R  
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  7.147.   We note that in China – HP-SSST (Japan) / China – HP-SSST (EU) , the Appellate Body 
stated that the inquiry with regard to "significant price undercutting" requires " a dynamic 
assessment of price developments and trends in  the relationship between the prices of the 
dumped imports and those of domestic like products over the entire  period of investigation".305 
The consideration as to whether the observed price undercutting is significant will necessarily 
depend on  the circumst ances of each case and may involve an examination  of the nature of the 
products or product types at issue, the extent and duration of price undercutting, or the relative 
market shares of the product types with respect to which the authority has made a find ing of price 
undercutting .306, 307  
7.148.   The obligation under Article 3.2 is to " consider ", i.e. to take into account, whether there 
has been a significant price undercutting (or whether the effect of dumped imports is otherwise 
significant price depression or significant price suppression), rather than to make a determination  
regarding the ef fects of dumped imports on prices.308 The provisions of Article 3 contemplate "a 
logical progression of inquiry leading to an investigating authority's ultimate injury and causation 
determination."309 The consideration of the effects of dumped imports on price s is a step in the 
logical progression toward a determination whether injury is caused by the dumped imports.310 
The consideration of price effects under Article 3.2 is necessary in order to answer t he ultimate 
question in Article  3.5 as to whether dumped  imports are causing injury to the domestic industry. 
The outcome  of this inquiry  thus forms a basis for the overall causa tion analysis under  Article 3.5, 
which requires an investigati ng authority to demonstrate that the dumped imports are causing 
injury to t he domestic industry " 'through  the effects of ' dumping, or subsidies '[ a]s set forth in 
paragraphs 2 and  4'".311  
7.149.   Article 3.2 establish es a link between the price of dumped  imports and that of like 
domestic products, by requiring that a comparison be made be tween the two.312 When conducting 
a price effects analysis and comparing prices of the imported product to a certain domestic 
product, panels and the Appellate Body have emphasized that it is appropriate and important to 
consider factors affecting comparabil ity, including the competitive relationship between the 
imported and domestic products at issue. Specifically, the Appellate Body stated in China – GOES  
that even though there is no explicit requirement regarding price comparability in Article 3.2, the 
failure to ensure price comparability is incompatible with basic principles for injury determination 
provided in Article 3.1.313 The panels in China – Broiler Products  and China – X-Ray Equipment 
highlighted that the failure to ensure price comparability in the price effects analysis could lead to 
a distorted analysis of the causal link between dumped imports and the injury to the domestic 
industry.314 The panel in China – X-Ray Equipment stated that if two products being compared are 
not in competition with ea ch other and thus are not comparable, the results of such analysis would 
not provide a reasonable basis for the causation analysis.315 
7.150.   We agree with Indonesia that there are complexities in the competitive relationship 
between PME imports from Indonesia and blended CFPP 0 biodiesel from the European Union that 
were not considered by the EU authorities in their price undercutting analysis. We note in 
particular that due to its higher CFPP level, Indonesian PME is generally not used on its own in the 
                                                
305 Appellate Body Report s, China – HP-SSST (Japan) / China – HP-SSST (EU) , para. 5.159.  
306 Appellate Body Report s, China – HP-SSST (Japan) / China – HP-SSST (EU) , para.  5.161.  
307 In making its claim under Articles 3.1 and 3.2, Indonesia also refers to the legal standard under 
Article 3.5 developed by the Appellate Body in China – HP-SSST (Japan) / China – HP-SSST (EU) . (Indonesia's 
second written submission, para.  149 (referring to Appellate Body Report s, China – HP-SSST (Japan) / China – 
HP-SSST (EU ), para. 5.262) ). In this regard, we note that the requirements under Articles  3.2 and 3.5 are 
different. In China – GOES , the Appellate Body stated that the inquiry under Ar ticle 3.2 "does not duplicate the 
different and broader examination regarding the causal relationship" between dumped imports and injury to 
the domestic industry pursuant to Article 3.5. (Appellate Body Report, China – GOES , para. 154).    
308 Appellate Body Report, China – GOES , para. 130.  
309 Appellate Body Report, China – GOES , para. 128.  
310 Panel Report, China – Cellulose Pulp , para. 7.64.  
311 Appellate Body Report, China – GOES , para. 143  (emphasis original) ; Panel Report, China – X-Ray 
Equipment , para.  7.50. 
312 Appellate Body Report, China – GOES , para. 136.  
313 Appellate Body Report, China – GOES , para. 200. See also Appellate Body Report s, China – HP-SSST 
(Japan) / China – HP-SSST (EU) , para. 5.161  and fn 382. 
314 Panel Reports, China – Broiler Products , para. 7.475 ; China – X-Ray Equipment , para. 7.51.  
315 Panel Report, China – X-Ray Equipment , para. 7.50.  WT/DS480/R  
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  EU market,  but is rather an input to produce blended biodiesel.316 Specifically, the EU authorities 
stated that:  
SME and PME biodiesel could be used in their pure forms  but they are generally 
blended, either among themselves  or with RME, before being us ed in the 
Europ ean Union.  The reason for blending SME with PME is that SME in its  pure form 
does not meet the European standard EN  14214 as regards iodine and cetane 
numbers. The  reason for blending PME (and SME) with RME is that  PME and SME have 
a higher Cold Filter Plu gging Point  (CFPP) than RME and are not therefore suitable for 
use in  their pure form during winter months in cold regions of  the European Union.317 
7.151.   The EU authorities also observed that:  
[T]he Cold Filter Plugging  Point ( 'CFPP ') of PME (at +13 Centigrade) m eans that  PME 
cannot be used across the Union without being  mixed with other biodiesels to bring 
down the CFPP.318 
7.152.    In response to a question from the Panel, Indonesia explained that the amount of PME 
used in a blend would depend on the season and location. In Southern Europe, CFPP -5 biodiesel is 
used in winter months while CFPP +5 biodiesel is used in summer months. In Northern Europe, 
CFPP -10 biodiesel is used in winter months and CFPP 0 biodiesel is alternately used in summer 
months. Indonesia noted that  in summer months, PME is blended at an average of 70% in Italy 
and Spain, while in winter months  it can not be used at all . In the Scandinavian countries, PME may 
not even be used at all during the year.319 The European Union has not contested this explanati on. 
7.153.   We note that the Definitive Regulation confirms that sales of PME are affected by issues 
pertaining to seasonality:  
Both SME and PME are imported into the Union, and are also manufactured within the 
Union, and are blended with RME and other biodiesels manufactured within the Union 
before being sold or blended with mineral diesel. The blenders have the choice of 
purchasing biodiesel from different feedstocks and different origins to produce their 
final product, based on the market and the climatic condit ions throughout the year. 
PME is sold in larger quantities during the summer months and smaller quantities 
during the winter months, but it is still in competition with RME and Union made 
biodiesel and also SME from Argentina.320 
7.154.   This recital suggests that PME competes with SME from Argentina, RME , and other 
biodiesels produced by the EU industry, because they are used to make various blends that are 
suitable for certain climatic conditions. However, this recital does not address the important issue 
of wheth er imports of PME from Indonesia compete with blended CFPP 0 biodiesel produced by the 
EU industry. Taking into account this statement of the EU authorities, the Panel specifically asked 
the European Union to explain whether  climatic conditions affect the competition between PME and 
blended CFPP 0  biodiesel. The European Union did not specifically address the issue of competition 
between imported PME and blended  CFPP 0 biodiesel in its reply. The European Union simply 
stated that " [c]limatic conditions infl uence the suitable CFPP of the blend in differ ent parts of the 
European Union", and that PME is blended with biodiesel having a lower CFPP (e.g. RME) in order 
to achieve CFPP 0.321  
7.155.   We note that recital 34 of the Provisional Regulation indicates that importe d biodiesel and 
EU biodiesel had similar basic physical, chemical, technical characteristics , and uses, and were 
                                                
316 Provisional Regulation, (Exhibit IDN -1), recitals 32 and 148.  The European Union explained that  the 
main produ ct sold in the European Union was  CFPP 0, which  contains PME and other biodiesels blended 
together . (European Union's response to Panel question No. 88, para. 41) . The European Union further noted 
that "[a] s PME has a higher CFPP (mostly CFPP 13), it is blended with biodiesel having a lower CFPP (e.g. RME) 
in order to achieve CFPP 0 ". (European Union's response to Panel question No. 91, para. 47).  
317 Provisional Regulation, (Exhibit IDN -1), recital 32.  
318 Provisional Regulation, (Exhibit IDN -1), recital 148.  
319 Indonesia's response to Panel question No. 89. 
320 Definitive Regulation, (Exhibit IDN -2), recital 117.  
321 European Union's response to Panel question No. 91, para. 48 . WT/DS480/R  
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  considered to be like products.322 We also note that recital  18 of the Definitive Regulation rejects 
the argument of an interested party that PME  is not a like product to biodiesel produced by the 
EU industry due to its high CFPP level, which necessitates that PME is blended with other types of 
biodiesel before use in the EU market. In particular, recital 18 reads:  
PME produced in Indonesia is in competition with biodiesel produced in the Union, 
which is not just RME but also biodiesel made from palm oil and other feedstocks. PME 
can be used throughout the Union throughout the year, by blending with other 
biodiesels before use, in the same way as R ME and SME. PME is therefore 
interchangeable with biodiesel made in the Union and therefore is a like product.323 
7.156.   The fact that the imported and domestic products were considered to be like products does 
not automatically mean that each of the products inclu ded in the basket of imported products is 
alike in all respects to each of the products included into the basket of domestic products.324 Nor 
does the fact that the imported and domestic products were considered to be like products address 
the particular com petitive dynamic that PME may only be used in a blend, and is actually a 
component of the different blends sold to end users in the EU marke t. PME might compete with 
RME to the extent that they both are used to produce a blend. However, this does not mean that 
PME and blended CFPP 0 biodiesel are in competition with each other. In response to a question 
from the Panel t he European Union confirmed this understanding, noting that "[recital 18 of the 
Definitive Regulation ] does not state that In donesian import s of PME and blends or EU industry 
CFPP 0 biodiesel  are in competition with each other. "325, 326 
7.157.   The EU authorities found that the imported biodiesel was blended with mineral diesel by 
the same trading companies and sold to customers at the EU market in direct  competition with 
biodiesel produced by the EU industry.327 Even though both PME from Indonesia and blended 
CFPP 0 biodiesel might compete for sales to the companies who blend biodiesel with mineral 
diesel, this point nonetheless does not address the fact th at the EU authorities failed to explain 
                                                
322 Recital 34 of the Provisional Regulation states:  
The investigation has shown that the product concerned, the product produced and s old on the 
domestic market of Argentina and Indonesia, and the product produced and sold in the Union by 
the Union industry have similar basic physical, chemical, technical characteristics and uses. They 
are therefore provisionally considered to be alike w ithin the meaning of Article 1(4) of the basic 
Regulation.  
(Provisional Regulation, (Exhibit IDN -1), recital 34)  
323 Definitive Regulation, (Exhibit IDN -2), recital 18.  
324 Panel Report, China – X-Ray Equipment , para. 7.65  (referring to Panel Report, EC – Salmon 
(Norway) , paras. 7.13 -7.76), which reads:  
[A] number of panels have clarified that where a broad basket of goods under consideration and 
a broad basket of domestic goods have been found by an investigating authority to be "like", this 
does not mean that  each of the goods included in the basket of domestic goods is "like" each of 
the goods included within the scope of the product under consideration.  
In addition, the panel in China – Broiler Products  stated:  
[I]n our view, ensuring that the products bei ng compared are "like products" will not always 
suffice to ensure price comparability. Where the products under investigation are not 
homogenous, and where various models command significantly different prices, the investigating 
authority must ensure that the product compared on both sides of the comparison are sufficiently 
similar such that the resulting price difference is informative of the "price undercutting", if any, 
by the imported products.  
(Panel Report, China – Broiler Products , para. 7.483)  
325 European Union's response to Panel question No. 92, para. 49.  
326 The European Union also notes that the EU authorities conducted a cumulative assessment of the 
effects of the dumped imports from Indonesia and Argentina on the prices of the domestic like produc t. The 
fact that the EU authorities decided to undertake a cumulative assessment based on the circumstances is not 
determinative of whether the requirements of Article 3.2 have been met. In a ny event, although the 
European  Union refers to the fact that imp orts were assessed cumulatively, as Indonesia points out, the EU 
authorities assessed price undercutting separately for Indonesia and Argentina, due to the difference in 
products exported by these countries. The EU authorities clearly indicated that all Ar gentine exports were at a 
CFPP level of 0, while Indonesian imports were not, requiring a price adjustment, as discussed above. 
(European Union's response to Panel question No. 90, para. 42; Indon esia's comments on the 
European  Union's response to  Panel  question No.  90, paras. 17 -20).  
327 Provisional Regulation, (Exhibit IDN -1), recital 89.  WT/DS480/R  
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  whether the comparison between sales of PME and blended CFPP 0 biodiesel was made at a proper 
comparison level, given that PME is an input to the blends, including CFPP 0 biodiesel.328  
7.158.   In our view, an objective and un biased investigati ng authority should have explained why 
it was reasonable and adequate to compare the prices of blended CFPP 0 biodiesel with the prices 
of PME that is used as an input to produce such blend. The particular physical properties and end 
uses (for blending) have implications when it comes to competition between the compared 
products, i.e. an end user cannot simply use PME to the extent that blended CFPP 0 biodiesel is not 
available, due to climatic limitations related to CFPP levels. This necessarily affects price 
comparability in respect of those products. Although the EU  authorities made an adjustment to the 
price of Indonesian PME to account for different CFPP levels of Indonesian and EU biodiesel, we are 
of the view that this adjustment  is not sufficient to account for complexities in competitive 
relationships between PME and blended CFPP 0 biodiesel, given that Indonesian PME is an input to 
blended biodiesel, including blended CFPP 0.  
7.159.   Under these circumstances, we consider that the comp etitive dynamic between imports of 
Indonesian PME and blended CFPP 0 biodiesel is significantly more complex than the E U 
authorities ' determination would suggest. The effect of seasonality in particular suggests that 
competition between imported PME and blended  CFPP 0  biodiesel  will often be nuanced, rather 
than "direct".  While it is not impossible that a more complex analysis would still have justified a 
finding that imports of PME had a significant price undercutting effect on price of blended CFPP 0 
biodiesel sold by the EU industry, Indonesia has raised a series of legitimate questions regarding 
the validity of the EU  authorities' analysis. The European Union has failed to resolve these 
questions, or rebut the case made by Indonesia.329 
7.160.   We now turn to Indo nesia's argument that the EU authorities improperly limited the price 
undercutting analysis to only 37% of the EU industry's sales. As discussed above, the EU 
authorities based the price undercutting calculations on the EU industry's sales of blended CFPP 0 
biodiesel, which was the product with the highest volume of sales , representing 37% of the EU 
sampled producers' sales. We note that Articles 3.1 and 3.2 of the Anti -Dumping Agreement do 
not require an investigating authority to consider the existence of  price undercutting with regard to 
the entire range of domestic like products.330 There is no requirement in the Anti -Dumping 
Agreement that provides any specific percentage of the domestic industry sales to be considered in 
the price effects analysis. Indon esia acknowledges that there is no obligation under Article 3.2 to 
establish the existence of price undercutting with regard to the entire range of domestic like 
products.331 Rather, Indonesia argues that extending the price undercutting analysis to  at least  
two or three  additional products sold by the EU  industry would have significantly increased the 
credibility of the EU authorities'  findings .332 Indonesia adds that the EU authorities did not assess 
the significance of price undercutting in relation to the r emaining 63% of the EU industry's 
                                                
328 We note the argument of the European Union that PME imports from Indonesia were bought by both 
the EU industry in self -defence and also by blenders and traders. The Eu ropean Union submits that the EU 
producers were in competition with traders and blenders which bought PME directly and Indonesian exporting 
producers with related importers in the European Union, which imported PME and then resold it. The 
European  Union su bmits that this would be the correct price competition point . (European Union's opening 
statement at the second meeting of the Panel, paras. 43 -44). Indonesia agrees that EU producers are likely to 
be in competition with traders and blenders . (Indonesia's response to Panel question No.  100, para. 86).This 
argument of the European Union fails to address the issue of whether there is a direct competition between 
CFPP 13 biodiesel from Indonesia and blended CFPP 0 biodiesel sold by the EU industr y. 
329 We note the argument of the European Union that the existence of significant price undercutting was 
considered in the framework of other factors, such as an increase in volume of dumped imports from Indonesia 
and its market share in the EU market as w ell as a series of factors having a bearing on the state of the 
domestic industry . (European Union's first written submission, paras. 99 -105). The fact that the existence of 
significant price undercutting was considered together with other factors examined  for the purpose of injury 
analysis does not change our conclusion that the EU authorities' analysis of the price relationship between 
imported PME and blended CFPP 0 biodiesel is flawed, because it is not clear that imports of PME had an effect 
on prices of blended CFPP  0 biodiesel sold by the EU industry.  
330 Appellate Body Report s, China – HP-SSST (Japan) / China – HP-SSST (EU) , para. 5.180 (referring to 
Panel Report s, China – HP-SSST (Japan) / China – HP-SSST (EU) , para. 7.141 ). 
331 Indonesia's first writt en submission, para. 241 (referring to Appellate Body Reports, China – 
HP-SSST (Japan) / China – HP-SSST (EU) , para. 5.180 ).  
332 Indonesia's second written submission, para. 166; o pening statement at the s econd meeting of the 
Panel, para . 79.   WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  sales.333 We found above that the EU authorities' analysis of the price relationship between 
imported PME and blended CFPP 0 biodiesel is inadequate, because it fails to establish whether 
imports of PME from Indonesia had an  effect on prices of blended CFPP  0 biodiesel sold by the 
EU industry. Given our finding that the price undercutting analysis is flawed, the question whether 
this analysis should have included a broader range of the domestic like products becomes moot. 
Given the failure by the EU authorities to properly establish price undercutting in respect of the 
price comparison that they did make, there is no sense in seeking to ascertain whether or not the 
EU authorities ' analysis is sufficient to draw any conclusions  regarding the existence of price 
undercutting more generally, including in respect of other products sold by the EU industry.334  
7.161.   Based on the above, we find that Indonesia has demonstrated  that the EU authorities  
failed to establish that imports from Indon esia had an effect on prices of blended CFPP 0 biodiesel 
sold by the EU industry.  Therefore, we find that Indonesia has made a prima facie  case that the 
European Union acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping Agreement by 
failing to establish the existence of significant price undercutting with regard to Indonesian 
imports.  This prima facie  case has not been rebutted by the European Union.  
7.6.5   Conclusions  
7.162.   As indicated above, we find that Indonesia failed to establish that the European  Union 
acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping Agreement, by relying on prices 
of CFPP 13 biodiesel produced by the EU industry in calculating an adjustment to the price of 
Indonesian imports.  We further find that Indonesia made a prima facie  case that the EU authorities 
acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping Agreement, by failing  to 
establish the existence of significant price undercutting  with regard to Indonesian imports . Since 
that prima facie  case has not been rebutted, we uphold Indonesia's claim accordingly.  
7.7  Whether the European Union acted inconsistently with Article 9.3 of the 
Anti-Dumping Agreement and Article VI:2 of the GATT 1994 by imposing and levying 
anti-dumping duties in excess of the ma rgins of dumping  
7.7.1   Introduction  
7.163.   Indonesia claims  that the European Union acted inconsistently with Article 9.3 of the 
Anti-Dumping Agreement and Article VI:2 of the GATT 1994 by imposing and levying anti -dumping 
duties in excess of the margin of dumping that  should have been established in accordance with 
Article 2 of the Anti -Dumping Agreement.  Indonesia submits that this results from the fact that the  
European Union acted inconsistently with  Article s 2.2, 2.2.1.1, 2.2.2(iii), and 2.3 of the 
Anti-Dumping Agr eement  when constructing the normal value for Indonesian exporters and 
establishing the constructed export price  for one Indonesian exporter . Indonesia submits  that, if 
the dumping margins ha d been correctly calculated in conformity with Article 2, this would have 
resulted in negative dumping margins in certain cases, or the margins of dumping would have 
been significantly lower than the duties imposed by the European Union.335 The European Union  
                                                
333 Indonesia' s second written submission, para. 167; o pening statement at the s econd meeting of the 
Panel, para . 80.   
334 In its second written submission, Indonesia takes issue with the fact that the price undercutting 
analysis only covered the period from 1 July 2011 to 30 June 2012. Indonesia submits that the EU authorities 
failed to provide data on the price of CFPP 0 biodiesel during the entire period considered for the injury 
assessment, i.e. from 1 January 2009 to 30 June 2012, and instead only provided data on av erage prices of 
the EU industry during this period . (Indonesia's second written submission, paras. 157 -159). We note that 
similar to Indonesia's arguments discussed in paras. 7.139.   -7.141.    above, Indonesia did not raise the issue 
of period considered for the price undercutting analysis in its first written submission. Th is allegation appears 
to relate to Indonesia's broader claim that the EU authorities failed to perform a dynamic assessment of price 
developments and trends over the entire period of investigation. Nevertheless, the specific factual allegations 
are new and  were not raised by Indonesia in its first written submission. We therefore consider it inappropriate 
to address this new allegation in our report. In any event, it is well -established that panels do not need to 
address all arguments made by the parties . (See, e.g. Appellate Body Report, US – Carbon Steel  (India) , 
para. 4.233). We do not need to address this argument in order to resolve the dispute before us, since we 
have already found that the EU authorities' price undercutting analysis was flawed.  
335 Indonesia's first written submission, paras. 271 -272; second written submission, paras. 170 -174. WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  has acknowledged  the factual description provided by Indonesia, but has not responded to the 
substance of Indonesia's claim.336 
7.7.2   The EU authorities' imposition of definitive anti -dumping duties  
7.164.   We recall  that, on 29 May 2013, the EU authorities imposed indiv idual provisional 
anti-dumping dut ies on four sampled Indonesian producer s ranging between zero and 9.6%.337 At 
the provisional stage, the dumping margins for the producers were based on the decision of the EU 
authorities to construct the normal value based on the recorded costs of production of Indonesian 
producers  during the investigation period, the SG&A  expenses incurred and a 15% profit 
margin .338 In the Definitive Disclosure, the European Union revised its methodology for 
establishing the cost of producti on of biodiesel by replacing the recorded costs of CPO of 
Indonesian producers with an international reference price  published by the Indonesian 
government. The EU authorities based their decision to replace the recorded costs of production on 
the finding that the Indonesian DET system distorted the costs of production of biodiesel 
producers.339 As a result of this adjustment, the anti -dumping duty rates for Indonesian producers 
increased significantly. Definitive dumping margins were calculated ranging from 8.8% to 23.3% 
and definitive anti -dumping duties were applied corresponding to the calculated injury margins, 
which ranged from 8.8% to 20.5%.340 The duties were applied in the form of specific duties 
expressed as a fixed amount in euro/tonne.  
7.7.3   Whether Indonesia has established  that the European Union acted inconsistently 
with Article 9. 3 of the Anti -Dumping Agreement  and Article VI:2 of the GATT 1994  
7.165.   The chapeau  of Article 9.3 of the Anti -Dumping Agreement provides that:  
The amount of the anti -dumping duty shall not exceed the margin of dumping as 
established under Article 2.  
7.166.   Article VI:2 of the GATT 1994 provides that:  
In order to offset or prevent dumping, a contracting party may levy on any dumped 
product an anti -dumping duty not greater in am ount than the margin of dumping in 
respect of such product. For the purposes of this Article, the margin of dumping is the 
price difference determined in accordance with the provisions of paragraph 1.  
7.167.   Indonesia submits that, in order to demonstrate a viola tion of Article 9.3 of the 
Anti-Dumping Agreement, it is required to demonstrate, first, that the margin of dumping 
calculated by the EU authorities was determined in violation of the di sciplines prescribed in 
Article  2 of the Anti -Dumping Agreement, and s econd, that the anti -dumping duties were imposed 
at a rate that is higher than the dumping margin that would have been established had the EU 
authorities acted consistently with Article 2.341 Indonesia submits that a similar approach may be 
taken to establis h a violation of Article VI:2 of the GATT 1994.342 
7.168.   Similar claims were raised by Argentina in EU – Biodiesel (Argentina) . In addressing 
Argentina's Article 9.3 claim, t he panel considered  that the term "margin of dumping " in Article 9.3 
"relates to a margin [of dumping ] that is established in a manner subject to the disciplines of 
Article 2 and which is therefore consistent with those disciplines".343 The panel  additionally  
                                                
336 European Union's first written submission, paras. 110 -111; second written submission, para. 62.  
337 Provisional Regulation, (Exhibit IDN -1), recital 179.  
338 Provisional Regulation, (Exhibit IDN -1), recital 63.  
339 Definitive Disclosure, (Exhibit IDN -7), recitals 57 -62. 
340 Definitive Regulation, (Exhibit IDN -2), recital 215 . The injury margins for two Indonesian producers 
were determined to be higher than the cor responding dumping margins. Anti -dumping duty rates were 
assessed at the rate of the dumping margins for those producers.  
341 Indonesia's first written submission, para. 274.  
342 In order to demonstrate a violation of Article VI:2 of the GATT 1994, Indonesia s ubmits that a 
complainant must demonstrate that : (a) the dumping margin was not determined in accordance with the 
disciplines laid out in Article VI:1 of the GATT 1994; and ( b) that the anti -dumping duties are imposed at a rate 
that is higher than the dump ing margin that would have been established had the authority acted consistently 
with Article VI:1 of the GATT 1994. (Indonesia's first written submission, para. 281 ). 
343 Panel Report, EU – Biodiesel (Argentina) , para. 7.359.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  observed that Article 9.3 also sets the maximum level at which anti -dumping duties may b e 
levied.344 With these considerations in mind, t he panel recalled its finding that the European Union 
acted inconsistently with Articles 2.2.1.1 and 2.2 of the Anti -Dumping Agreement and with 
Article  VI:1(b)(ii) of the GATT 1994 in establishing the dumping margins in the Definitive 
Regulation due to the use of surrogate input prices in the construction of normal value for 
investigated Argentine producers.345 The panel considered whether this finding could provide a 
basis to establish an inconsistency with Arti cle 9.3.  The panel observed that an error or 
inconsistency under Article 2 of the Anti -Dumping Agreement "does not necessarily or 
automatically mean that the anti -dumping duty actually applied will exceed the correct margin of 
dumping".346 The panel recalled  that the EU authorities had used actual input prices when 
constructing the normal value and calculating the dumping margins at the provisional stage. While 
it was not possible to infer the exact dumping margins that would have been established had the 
determinations been done in accordance with Article 2,  the panel considered that "the dumping 
margins established in the Provisional Regulation provide a reasonable approximation of what 
margins calculated in accordance with Article 2 of the Anti -Dumping Agre ement might have 
been".347  
7.169.   The panel recalled that the margins of dumping calculated in the Provisional Regulation 
ranged from 6.8% to 10.6%, while the duties imposed by the EU authorities in the Definitive 
Regula tion ranged from 22.0% to 25.7%, an amount t hat was "two to three times higher".348 The 
panel consider ed this to be a "substantial difference" which "suggests that the anti -dumping duties 
imposed by the European Union in the Definitive Regulation exceeded what the dumping margins 
could have been had t hey been established in accordance with Article 2".349 On this basis, the 
panel concluded that Argentina had made a prima fac ie case that the European Union had acted 
inconsistently with the chapeau  of Article 9.3 of the Anti -Dumping Agreement.350  
7.170.   The panel further considered this "substantial difference" gave  rise to a violation of 
Article  VI:2 of the GATT 1994. The panel noted that Article VI:2 of the GATT 1994  provides that a 
WTO Member "may levy … an anti -dumping duty not greater in amount than the margin of 
dumping in respect of such product", further specifying that "[f]or the purposes of this Article, the 
margin of dumping is the price difference determined in accordance with [Article VI:1]".  The panel 
in EU – Biodiesel (Argentina) considered that the terms "in accordance with" makes clear that 
Article VI: 2 prohibits the levying of anti -dumping duties in excess of the dumping margin 
determined consistently with Article VI:1 of the GATT 1994 in the same way as the phrase "as 
established under Article 2" operates in Article 9.3.351 Therefore, the reasoning applied under 
Article 9.3 applies mutatis mutandis  to Argentina's claim under Article VI:2 of the GATT 1994.352 
7.171.   The Appellate Body upheld the panel's  reliance on the margins calculated in the Provisional 
Regulation as appropriate in light of the specific circumstances .353 The Appellate Body also agreed 
with the panel that the same consideration s that guided i ts assessment of Argentina's Article 9.3 
claim apply to its assessment under Article VI:2 of the GATT 19 94.354 
7.172.   We have found in Sections 7.3.3   and 7.3.4    above that the European Union acted 
inconsistently with Articles 2.2.1.1 and 2.2 of the Anti -Dumping Agreement and with 
Article  VI:1(b)(ii) of the GATT 1994 in establishing the dumping margin s in the Definitive 
Regulation due to the use of surrogate input prices in the construction of normal value for 
investigated Indonesian producers. As Indonesia has indicated, the margins calculated in the 
Provisional Regulation ranged from zero to 9.6%, wh ile the duties imposed by the EU authorities in 
the Definitive Regulation ranged from 8.8% to 20. 5%, amounts which are  twice as high or greate r 
                                                
344 Panel Report, EU – Biodiesel (Argentina) , para. 7.360.  
345 Panel Report, EU – Biodiesel (Argentina) , para. 7.364.  
346 Panel Report, EU – Biodiesel (Argentina) , para. 7.363.  
347 Panel Report, EU – Biodiesel (Argentina) , para. 7.365.  
348 Panel Report, EU – Biodiesel (Argentina) , para. 7.365.  
349 Panel Report, EU – Biodiesel (Argentina) , para. 7.365.  
350 Panel Report, EU – Biodiesel (Argentina) , para. 7.365.  
351 Panel Report, EU – Biodiesel (Argentina) , para. 7.366.  
352 Panel Report, EU – Biodiesel (Argentina) , para. 7.366.  
353 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.110.  
354 Appellate Body Report, EU – Biodiesel (Argentina) , para. 6.112.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  in the case of each Indonesian producer/exporter.355 The difference is attributable to the change in 
the basis for  constructing the normal value between the Provisional Regulation and the Definitive 
Regulation.  In our view, this difference is significant . As the panel did in EU – Biodiesel 
(Argentina) , we therefore consider it appropriate to rely on the margins calcul ated in the 
Provisional Regulation as a basis to finding that the definitive anti -dumping duties imposed on 
Indonesian producers/exporters exceeded what the dumping margins might  have been had they 
been established in accordance with Article 2  of the Anti -Dumping Agreement .  
7.173.   For the foregoing reasons , we uphold  Indonesia's claim  that the European Union acted 
inconsistently with Article 9.3 of the Anti -Dumping Agreement by imposing anti -dumping duties in 
excess of the margin of dumping that should have been established under Article 2 of the 
Anti-Dumping Agreement. We further consider it appropriate to follow the approach taken by the 
panel in EU – Biodiesel (Argentina)  in respect of Indonesia's claim under Article VI:2 of the 
GATT  1994.356 Accordingly, we find  that the same considerations that informed our assessment of 
Indonesia's claim under Article 9.3 therefore apply mutatis mutandis  to our assessment of its 
Article VI:2 claim. We therefore also uphold  Indonesia's claim  that the European Union acted 
inconsi stently with Article VI:2 of the GATT 1994.  
7.7.4   Conclusions  
7.174.   As indicated above, we consider that "margin of dumping" referred to in Article 9.3 of the 
Anti-Dumping Agreement relates to a margin of dumping that is established in a manner subject to 
the discipli nes of Article 2 of the Anti -Dumping Agreement and which is therefore consistent with 
those disciplines. We find that Indonesia  has made a prima facie  case that the European Union 
acted inconsistently with Article 9. 3 of the Anti -Dumping Agreement  by impos ing anti -dumping 
duties in excess of the margin of dumping that should have been established under Article 2 of the 
Anti-Dumping Agreement. In addition, we find that the same considerations that informed our 
assessment of Indonesia's claim under Article 9. 3 apply mutatis mutandis  to our assessment of its 
Article VI:2  claim . We therefore also conclude that that the European Union acted inconsistently 
with Article VI:2 of the GATT 1994.  
7.8  Whether the European Union acted inconsistently with Articles 7 and 9 of the 
Anti-Dumping Agreement  through the application and definitive collection of provisional 
anti-dumping duties  
7.8.1   Introduction  
7.175.   Indonesia submits  that the European Union committed several errors in calculating a 
provisional margin of dumping of 2.8% for the sampled Indonesian producer, P.T. Musim Mas , 
which  led to an inflated provisional dumping margin that otherwise would have been negative.357 
Indonesia claims that the European Union acted inconsistently with a number of provisions  of the 
Anti-Dumping Agreement  because it applied and definitively collected provisional anti -dumping 
duties on imports from P.T. Musim Mas . Specifically, Indonesia reques ts the Panel to find that the 
European Union acted inconsistently with358: 
a. Article 7.1 of the Anti -Dumping Agreement because it applied provisional measures to 
P.T. Musim Mas  based on a WTO inconsistent preliminary determination of the existence 
of dumping  for P.T. Musim Mas ; 
b. Article 7.2 of the  Anti-Dumping Agreement because it applied to P.T. Musim Mas  a 
provisional anti -dumping duty in excess of the provisionally estimated margin of 
dumping for P.T. Musim Mas ; 
c. Article 9.2  of the  Anti-Dumping Agreement becau se the provisional anti -dumping duty 
that was applied to P.T. Musim Mas  and definitively collected was not in an "appropriate 
amount" within the meaning of Article 9.2; and  
                                                
355 Indonesia's first written submission, table following para. 276. See also Provisional Regulation, 
(Exhibit IDN -1), recital 179 ; and Definitive Regulati on, (Exhibit IDN -2), recital 215.  
356 The approach of the panel in EU – Biodiesel (Argentina)  is set out in para. 7.170.    above.  
357 Indonesia's first written submissi on, para. 286.  
358 Indonesia's first written submission, para. 285.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  d. Article 9.3 of the  Anti-Dumping Agreement by applying to P.T. Musim Mas  and 
definit ively collecting a provisional anti -dumping duty in excess of the provisionally 
estimated margin of dumping for this exporting producer.  
7.8.2   The EU authorities' determination of a p rovisional margin of dumping for 
P.T. Musim Mas and the definitive collection o f provisional duties  
7.176.   We begin by recalling the relevant facts related to the European Union's determination of a 
provisional margin of dumping for P.T. Musim Mas  before addressing the substance of Indonesia's 
claims. On 29 May 2013, the EU authorities impo sed an individual p rovisional anti -dumping duty 
of 2.8% on the sampled Indonesian producer, P.T. Musim Mas, based on a 2.8% provisional 
dumping margin and a 23.3% provisional injury margin.359  
7.177.   In its comments on the Provisional Disclosure, P.T. Musim Mas  alleged  that the EU 
authorities made three "mathematical  and accounting errors "360 in calculating the normal value 
and export price, as follows:  
a. a mathematical error in calculating P.T. Musim Mas' domestic SG&A expenses by adding 
to the amount of SG&A for d omestic sales the amount of the export tax payable on 
exports of biodiesel , in constructing the normal value361;  
b. inconsistent accounting treatment of income tax expenses of two related import ers, 
[[***]] and [[ ***]], by treating income tax expenses for both  importers as an SGA 
expense , in addition to deducting an amount for income tax  expens es as part of a 5% 
reasonable profit margin based on turnover , in constructing the export price362; and  
c. inconsistent accounting treatment of gasoil hedging gains and losses , by deducting 
gasoil hedging losses from the resale prices of a related importer  [[***]] as an 
allowance while failing to include hedging gains of another related importer  [[***]] in its 
resale prices , in constructing the export price .363 
7.178.   The EU authorities  acknowledged these comments in the 1 October 2013 Definitive 
Disclosure  and indicated that necessary corrections were made .364 Specifically, with regard to the 
constructed normal value,  the EU authorities  exclud ed the export tax from the SG&A based on the 
fact that the export tax was not paid on domestic sales.365 With regard to the constructed export 
price, the EU authorities excluded income tax expenses from SG&A amounts366 and addressed the 
                                                
359 Provisional Regulation, (Exhibit IDN -1), recital 179.  
360 P.T. Musim Mas, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -18 (BCI)) , p. 1. 
361 P.T. Musim Mas, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -18 (BCI)) , pp. 1-2. 
362 P.T. Musim Mas, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -18 (BCI) , p. 3. 
363 P.T. Musim Mas, Comments on Provisional Disclosure (1 July 2013) , (Exhibit IDN -18 (BCI )), pp. 3-4; 
Specific Definitive Disclosure for [[ ***]], Annex 2 D (1 October 2013) , (Exhibit IDN -27 (BCI)) , p. 4; and 
Specific Provisional Disclosure for [[ ***]], annex 2 A , (Exhibit IDN -19 (BCI)) , p. 4. 
364 The Definitive Regulation notes that one interest ed party (P.T. Musim Mas) claimed that some 
"clerical mistakes" had been made in the calculation of the dumping margins at the provisional stage. 
(Definitive Regulation, (Exhibit IDN -2), recital 227 ). In the Definitive Disclosure, the EU authorities referr ed to 
"overstated SG&A", "an inconsistent accounting treatment of biodiesel hedging gains and losses" and "claims 
for data changes in the calculations", indicating in each case that "corrections" were made. (Definitive 
Disclosure, (Exhibit IDN -7), recitals  64, 73, 75, and 80 ).  
365 Definitive Disclosure, (Exhibit IDN -7), recital 64 ("One party claimed that in relation to recital (63) of 
the provisional Regulation an overstated SG&A was used for that party. After having examined this claim, it 
appeared that th e SG&A for both domestic and export sales was included in the construction of normal value. 
The necessary corrections to use the SG&A for only the domestic sales were accordingly made.") Four specific 
disclosures were issued to importing companies of P.T. Musim Mas explaining the change. (Specific Definitive 
Disclosure for [[ ***]], Annex 2 A (1 October 2013 ), (Exhibit IDN -28 (BCI)) , p. 2; Specific Definitive Disclosure 
for [[ ***]], Annex 2 B (1 October 2013) , (Exhibit IDN -29 (BCI)) , p. 2; Specific Definitive Disclosure for 
[[***]], Annex 2 C (1 October 2013) , (Exhibit  IDN-30 (BCI)) , p. 2; and Specific Definitive Disclosure for 
[[***]], Annex 2 D (1  October  2013) , (Exhibit IDN -27 (BCI)) , p. 2). 
366 Definitive Disclosure, (Exhibit IDN -7), recital 80 ("S everal exporting producers came also forward 
with claims for data changes in the calculations. Where these claims were substantiated with the necessary 
evidence, corrections were made"); Specific Definitive Disclosure for [[ ***]], Annex 2 D (1  October 2013 ), 
(Exhibit IDN -27 (BCI)) , p. 4; and Specific Definitive Disclosure for [[ ***]], Annex 2 C (1 October 2013) , 
(Exhibit IDN -30 (BCI)) , p. 4. Indonesia submits that SG&A expenses for [[ ***]] were decreased by 0.05% and WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  inconsistent treatment of hedging gains and losses by re -adding the a mount of hedging losses 
from the resale prices  of [[***]] that had been deducted as an allowance.367 
7.179.   In its comments on the Definitive Disclosure, P.T. Musim Mas  argued that the collection of 
provisional duties should only be done on the basis of the corrections that were made .368 Based on 
the above corrections, P.T. Musim Mas submitted that  the dumping margin at the provisional stage 
"would be  de minimis " and there fore no provisional duties should be collected .369 In the Definitive 
Regulation, the EU authorities confirmed the corrections .370 Notwithstanding, the EU authorities 
rejected the request by P.T. Musim Mas and ordered the definitive collection of the provisiona l duty  
that had been provisionally secured  on the basis that " the definitive anti-dumping duty is clearly  
higher than the provisional duty ".371 The definitive anti -dumping duty rate determined 
for P.T. Musim Mas was 16.9%, based on a dumping margin o f 18.3% and an injury margin 
of 16.9%.372 
7.8.3   Whether Indonesia has established violations of Articles 7 and 9 of the 
Anti-Dumping Agreement related to the definitive collection of provisional anti -dumping 
duties on imports from P.T. Musim Mas   
7.180.   Indonesia's claims under Articles 7.1(ii), 7.2, 9.2 , and the chapeau  of Article 9.3 of the 
Anti-Dumping Agreement relate to the decision of the EU authorities to definitively collect the 
provisional anti -dumping duties on imports from P.T. Musim Mas .373 
7.181.   Article 7.1 provides in relevant part:  
Provisional measures may be applied only if:  
… 
(ii) a preliminary affirmative determination has been made of dumping 
and consequent injury to a domestic industry; …  
7.182.   The first sentence of Article 7.2 provides : 
Provisional measures may take th e form of a provisional duty or, preferably, a 
security  – by cash deposit or bond  – equal to the amount of the anti -dumping duty 
provisionally estimated, being not greater than the provisionally estimated margin of 
dumping.  
7.183.   The first sentence of Article 9. 2 provides:  
When an anti -dumping duty is imposed in respect of any product, such anti -dumping 
duty shall be collected in the appropriate amounts in each case, on a 
non-discriminatory basis on imports of such product from all sources found to be 
                                                                                                                                                  
for [[ ***]] by 0.18% to address the over statement of income tax expenses. (Indonesia's first written 
submission, paras. 295 -298). 
367 The EU authorities recognized that hedging losses of [[ ***]] had been deducted as an allowance, 
while hedging gains of [[ ***]] were not taken into account, in const ructing the export price. The EU authorities 
determined that the export price should reflect the price actually paid or payable for the product when sold for 
export exclusive of any gain or loss related to hedging practices. Therefore, the EU authorities i ncreased the 
export price of [[ ***]] by the amount of hedging losses that were treated as an allowance. (Definitive 
Disclosure, (Exhibit IDN -7), recitals 74 -75; Specific Definitive Disclosure for [[ ***]], Annex 2 D (1 October 
2013) , (Exhibit IDN -27 (BCI)) , p. 4 ("The hedge allowance was not considered part of the export price. As 
stated in Article 2(8) of the Basic Regulation, the export price shall be the price actually paid or payable for the 
product when sold for export from the exporting country to the  EU. Therefore the hedge allowance as indicated 
in the column 'other allowances ' was now eliminated from the dumping calculation.") )  
368 P.T. Musim Mas, Comments on Definitive Disclosure, (Exhibit IDN -17 (BCI) ), paras. 2.2 and 21 -22. 
369 P.T. Musim Mas, Comme nts on Definitive Disclosure, (Exhibit IDN -17 (BCI) ), paras. 2.2 and 23.  
370 Definitive Regulation, (Exhibit IDN -2), recitals 76, 96 , and 102.  
371 Definitive Regulation, (Exhibit IDN -2), recital 227.  
372 Definitive Regulation, (Exhibit IDN -2), recital 215.  
373 See paras. 7.177.   -7.178.    above.  WT/DS480/R  
BCI deleted, as indicated [[***]]  
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  dumped and causing injury, except as to imports from those sources from which price 
undertakings under the terms of this Agreement have been accepted.  
7.184.   The chapeau  of Article 9.3 reads: "The amount of the anti -dumping duty shall not exceed 
the margin of dumping as est ablished under Article  2". 
7.185.   In addressing Indonesia's claims, we consider it necessary to first clarify the precise nature 
of the findings sought by Indonesia.  In its first submission, Indonesia framed its claims in respect 
of the fact that the EU authoriti es improperly  applied  provisional measures to P.T. Musim Mas , and 
thereafter  definitively collected  the provisional anti -dumping duty.374 Indonesia argued, for 
instance, that an investigating authority cannot simply disregard the d isciplines contained in 
Article 2 of the Anti -Dumping Agreement and impose and subsequently collect duties that exceed a 
provisionally estimated margin of dumping. In this respect, Indonesia argued that the language 
"provisionally estimated" in Article 7.2 cannot be understood as pe rmitting an investigating 
authority to make "clear cut and apparent " violations of Article 2.375 Indonesia submits that, if this 
were the case, this would defeat the purpose of imposing a limitation that provisional measures 
should not exceed the provisional ly estimated margin of dumping.376 Indonesia argues that 
corrections must be retroactive because, if investigating authorities were allowed to definitively 
collect provisional duties in excess of the actual provisional dumping margin, investigating 
authoriti es could circumvent the requirements of Article 7.2 (and Articles 9.2 and 9.3) by making 
errors when calculating the provisional dumping margin and thereafter collect those duties at the 
definitive stage.377 
7.186.   Following its first written submission, Indonesia made several subsequent clarifications 
regarding its claims. At the first substantive meeting with the Panel, for instance, Indonesia 
indicated that it does not challenge the provisionally estimated dumping  margin and the imposition 
of the provisional duties " as such ", but explained rather that  Indonesia "does  not agree with the 
definitive determination made in the Definitive Regulation to collect a provisional duty which the 
EU knew was erroneous and in exc ess of the real dumping margin that should have been 
determined at the provisional stage ".378 Indonesia further indicated that it does not  seek to  
challenge the Provisional Regulation but  "rather that part of the Definitive Regulation that ordered 
the defini tive collection of the provisional duties ".379 Subsequently, in response to a question from 
the Panel, Indonesia specified that it "only seeks a finding of the Panel with respect to the 
definitive collection of [the provisional duties applied to P.T. Musim M as] in the Definitive 
Regulation".380 
7.187.   From the outset, the European Union has maintained that In donesia's claims under 
Articles  7 and 9 are misconceived in light of Indonesia's clarification that its challenge is directed at 
the definitive collection of prov isional duties as opposed to any findings related to the imposition of 
provisional measures contained in the Provisional Regulation. T he European Union considers that 
this is confirmed by the fact that Indonesia has identified as the pertinent measure the Definitive 
Regulation that ordered the definitive collection of the provisional duties . The European Union 
submits that the relevant obligations governing the definitive collection of provisional anti -dumping 
duties are contained in Articles 10.3 and 10.5 of the Anti -Dumping Agreement.  The 
European  Union contends that the EU authorities respected the obligation contained in Article 10.3 
when collecting provisional duties that were secured for P.T. Musim Mas and therefore, Indonesia's 
claims should be reject ed.381 
7.188.   In light of the clarifications by Indonesia, we understand that Indonesia's challenge is 
limited to whether the definitive collection of provisional duties applied to P.T. Musim Mas was in 
any way inconsistent with the cited provisions of Article 7 or  9 of the Anti -Dumping Agreement. As 
                                                
374 See, e.g. Indonesia's first written submission, para. 285.  
375 Indonesia's first written submission, paras. 323 -324. 
376 Indonesia's first written submission, para. 326.  
377 Indonesia's first written submission, para. 340.  
378 Indonesia's opening statement at the first meeting  of the Panel , para. 59 . (emphas is original)  
379 Indonesia's opening statement at the first meeting  of the Panel , para. 59.  
380 Indonesia's response to Panel question No. 61, para. 95.  
381 European Union's first written submission, para. 129; opening statement at the first meeting  of the 
Panel , para. 48; response to Panel question No. 50, para. 78; and second written submission, paras. 63 -64 
(referring to Indonesia's responses to Panel question No. 55, para. 89 , and No. 61, para.  95). See also 
responses to Panel question Nos. 112, 114, 115, 117, 118, 120 , and 121.  WT/DS480/R  
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  Indonesia has clarified that it is not challenging  the fact that the EU authorities imposed 
provisional duties on P.T. Musim Mas pursuant to findings contained in the Provisional Regulation  – 
nor has Indonesia challenged in any way the right of the European Union to impose provisional 
measures  – we need not address issues related to the application , or imposition  of provisional 
measures. In this regard, it follows therefore, that Indonesia may establish its clai ms to the extent 
that the cited provisions in Articles 7 and 9 are pertinent to the definitive collection of provisional 
duties.   
7.189.   It is evident on the face of its various subparagraphs that Article 7 addresses the 
imposition, or application of provisional measures. Article 7.1 expressly refers to situations in 
which provisional measures may be applied  (stating that "Provisional measures may only be 
applied if:"). In turn, Article 7.2 addresses the form which provisional measures that are applied 
may take, i ncluding provisional duties or security equal to the amount of the duty provisional ly 
estimated, subject to the requirement that any duty or security taken does not exceed the 
provisionally estimated margin of dumping. Articles 7.3 and 7.4 address the peri od of application  
of provisional measures. Article 7.3 states that "[p]rovisional measures shall not be applied sooner 
than 60 days from the date of initiation of the investigation ". Article 7.4 indicates that "[t]he 
application of provisional measures sha ll be limited to as short a period as possible  …" Finally, 
Article 7.5 indicates that "[t]he relevant provisions of Article 9 shall be followed in the application 
of provisional measures" .382 
7.190.   At the provisional stage, the EU authorities calculated a 2.8% pro visional dumping margin  
for P.T. Musim Mas and subsequently ordered the imposition of provisional measures in respect of 
imports by P.T. Musim Mas.383 This determination is contained in the Provisional Regulation, which 
Indonesia has indicated that it does n ot challenge. We recall that Indonesia has requested us to 
make findings only in respect of the definitive  collection  of those duties. Article 7.2 addresses the 
form and amount  that provisional measures that are imposed may take, but does not address the 
definitive collection of those duties. As this is the case, we agree with the view o f the 
European  Union that Indonesia's claim under Article 7.2 as concerning the definitive collection of 
duties is misplaced. We therefore find that there is no  basis to con sider Indonesia's  claims under 
Article  7.2 of the Anti -Dumping Agreement as concerns the definitive collection of provisional 
anti-dumping duties on imports from P.T. Musim Mas . 
7.191.   In addition, we find there is no basis for Indonesia's claim under Article 7.1 (ii) of the 
Anti-Dumping Agreement because we consider that Indonesia's claim under Article 7.1(ii) is also 
dependent on the findings contained in the Provisional Regulation. The 
EU authorities'  determination that a preliminary affirmative determination has been made of 
dumping  for P.T. Musim Mas is based on those same findings.  
7.192.   We next consider the relevance of Indonesia's claims under Article 9.2 and the chapeau  of 
Article 9.3 of the Anti -Dumping Agreement.  Indonesia first claims that the European Union  acted 
inconsistently with Article 9.2 of the Anti -Dumping Agreement because the EU authorities did not 
definitively collect provisional anti -dumping duties in the "appropriate amounts", as required by 
the first sentence of Article 9.2.  
7.193.   According to Indon esia, the term "appropriate amount s" in Article 9.2 is informed by the 
provisions of Articles 7.2, 9.3 , and 10.3 of the Anti -Dumping Agreement. An appropriate amount 
that is collected may not exceed the amount of the provisionally estimated margin of dumpi ng that 
is determined consistently with Article 2 of the Anti -Dumping Agreement. Indonesia acknowledges 
that, once the definitive findings have been made, the amount of the provisional duty that is 
definitively collected must comply with the requirement in  Article 10.3 of the 
Anti-Dumping  Agreement. In particular, in cases where the definitive duty is lower than the 
provisional duty paid or payable, or the amount established for the purpose of the security that is 
taken, the difference shall be reimbursed o r the duty recalculated, as relevant to the 
circumstances.384 However, Indonesia argues that the requirement to definitively collect 
provisional anti -dumping duties in appropriate amounts cannot be set aside due to the fact that an 
investigating authority ma de calculation errors that led to a higher provisionally estimated margin 
                                                
382 Emphasis added.  
383 Provisional Regulation, (Exhibit IDN -1), recitals 60 -79 and 173 -182. 
384 Indonesia's first written submission, paras. 353 -354.  WT/DS480/R  
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  of dumping at the provisional stage , or the fact that the definitive duty is ultimately higher than 
the provisional duty.385 
7.194.   Indonesia considers that the appropriateness of the duty in  the context of 
provision al measures can be inferred from the requirement in the fir st sentence of Article 7.2 
that the provisional duty cannot be greater than the provisionally estimated margin of dumping.386 
In addition, Indonesia cites the definition of " appropriate" that was referred to by the panel in EC –
 Salmon (Norway) , as "specially suitable (for to); proper fitting".387 Thus, an "'appropriate' amount 
of anti -dumping duty must be an amount that results in offsetting or preventing dumping".388  
7.195.   Indonesia also claims that the European Union acted inconsistently with the chapeau  of 
Article 9.3 of the Anti -Dumping Agreement. Indonesia argues that the chapeau  of Article 9.3 is 
equally applicable to the imposition and definitive collection of provisional anti -dumping duties, 
and a violation results from the fact that the provisional anti -dumping duty that was applied to and 
definitively collected from P.T. Musim  Mas was in fact higher than the provisional ly estimated  
margin of dumping determined consistently wit h Article 2 of the Anti -Dumping Agreement.389 
Indonesia submits that the chapeau  of Article 9.3 sets the ceiling for the imposition and collection 
of anti -dumping duties.390 
7.196.   The European Union argues that Indonesia 's claim s under Article 9 .2 and the chapeau  of 
Article 9.3 should fail . The European Union contends that the EU authorities' preliminary 
determination of dumping in respect of P.T. Musim Mas was not based on a "flawed calculation" 
but was in fact a provisional estimate within the meaning of Article  7.2.391 Therefore, the 
Europe an Union argues that Indonesia has not established that the amount of the anti -dumping 
duty provisionally estimated was greater than the provisionally estimated margin of dumping and 
Indonesia cannot establish that the duties th at were collected were not in an appropriate 
amount.392 In addition, the European Union argues that Indonesia has failed to take into account 
that the definitive duty  has been found to be higher than the provisional duty paid or payable , 
which triggers the o bligations contained in Articles 10.3 and 10.5.  According to the first sentence 
of Article 10.3,  the European Union submits that  any amount estimated for the purpose of the 
security  need not be released if the definitive duty is higher than the p rovisional  duty paid or 
payable .393 The European Union submits that it respected this obligation by not collecting the 
difference between the definitive and provisional duties.394 
7.197.   We note that Article 9 is entitled "Imposition and Collection of Anti -Dumping Duties". We 
recall that Article 7.5 of the Anti -Dumping Agreement provides that "[t]he relevant provisions of 
Article 9 shall be followed in the application of provisional measures".  Thus, according to 
Article  7.5, we understand that certain provisions  of Article 9 co ncerning either the imposition or 
collection of anti -dumping duties may be relevant in respect of the application of provisional 
measures . This may include, for instance, the decision whether or not to impose anti -dumping 
duties in cases where all requirem ents for imposition have been fulfilled, or the decision whether 
the amount of the duty to be imposed shall be the full margin of dumping or less, as set out in 
Article 9.1. Article 9.2 indicates that anti -dumping duties that are imposed shall be collected  in the 
appropriate amounts in each case , on a non -discriminatory basis on imports of such product from 
                                                
385 Indonesia's first written submission, para. 357.  
386 Indonesia's first writt en submission, para. 355.  
387 Indonesia's first written submission, para. 356 (referring to Panel Report, EC – Salmon (Norway) , 
para. 7.704 ). 
388 Panel Report, EC – Salmon (Norway) , para s. 7.704 -7.705.  
389 Indonesia's first written submission, paras. 349 -350. 
390 Indonesia 's first written submission, para. 348 (referring to Appellate Body Report s, US – Zeroing 
(EC), para. 130 ; and US – Continued Zeroing , para. 315 ). 
391 See, e.g. European Union's first written submission, paras. 131 -133.  
392 European Union's first written submission, paras. 143 -148; response to Panel question No. 57, 
para. 84. 
393 Article 10.3 of the Anti -Dumping Agreement provides:  
If the definitive anti -dumping duty is higher than the provisional duty paid or payable, or the 
amount estimated for the purpose of the security, the difference shall not be collected. If the 
definitive duty is lower than the provisional duty paid or payable, or the amount estimated for 
the purpose of the security, the difference shall be reimbursed or the duty recalculated, as the 
case may be.  
394 European Union's second written submission, para. 65; response s to Panel question No. 47, para. 74 , 
and No. 49, para. 77. See also response to Panel questions No s. 51 and 52.  WT/DS480/R  
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  all sources found to be dumped and causing injury, except as to imports from those sources from 
which price undertakings have been accepted .395 The chapea u of Article 9.3 provides that the 
amount of anti -dumping duties shall not exceed the margin of dumping as established under 
Article 2. The European Union does not dispute that Article 9.2 and the chapeau  of Article 9.3 may 
be relevant in respect of provis ional measures.396  
7.198.   In our view, the definitive collection of  the provisional duties paid or payable is governed 
under either Article 10.3 or 10.5 of the Anti -Dumping Agreement. Pursuant to the first sentence of 
Article 10.3 if the definitive anti -dumping du ty is higher than the provisional duties  paid or 
payable, or the amount estimated for the purpose of the security, the difference shall not be 
collected. It may be inferred from this provision that an y provisional duty or security that has been 
collected  or otherwise secured by a cash deposit or bond  is confirmed . On the other hand , the 
second sentence of Article 10.3 provides that where the definitive duty is lower than the 
provisional duties or security collected or secured, the difference must be reimbur sed or the duty 
recalculated, as the case may be.  As to Article 10.5 , it states that any cash deposit made or bonds 
collected must be released expeditiously in cases where a final determination is negative.  
7.199.   In the circumstances of this dispute, the EU auth orities ordered the definitive collection of 
the provisional duty  that had been provisionally secured  on the basis that the definitive duty 
calculated was higher than the provisional duty .397 We agree with the European Union's argument  
that this approach is consistent with the obligation contained in Article 10.3 of the Anti -Dumping 
Agreement.  
7.200.   We disagree with Indonesia's argument that the EU authorities failed to collect duties in 
"appropriate amounts" within the meaning of Article 9.2  of the Anti -Dumping Ag reement . We recall 
that, pursuant to Article 7.5 of the Anti -Dumping Agreement , certain provisions of Article 9 may be 
relevant to "the application  of provisional measures". Yet, when referring to Article 9.2  we note 
that the provision  indicates that anti -dumping duties shall be imposed and collected in the 
"appropriate amounts" in each case  while Article 7 governs t he application of provisional 
measures.398 At the time of the application  of provisional measures, Article 7.2  specifically  allows 
for the collection of a provisional duty or otherwise the collection of security in the form of a cash 
deposit or bond. In either case,  the amount that is collected  shall not exceed the provisionally 
estimated margin of dumping. In this case, the EU  authorities collected security equal to the 
margin of dumping that had been calculated at the provisional stage . In this sense, we do not  see 
how the European Union failed to impose or collect duties in the appropriate amount at the time of 
the applicatio n of provisional measures . Article 9.2 cannot be interpreted without regard to 
Article  10.3 of the Anti -Dumping Agreement. The definitive collection of provisional duties occurred 
at the definitive stage following the correction of the errors that had been  identified by P.T. Musim 
Mas. In the Definitive Regulation, the EU authorities ordered the definitive collection of the 
provisional duty  consistent ly with the obligation in the first sentence of Article 10.3 of the 
Anti-Dumping Agreement , i.e. the EU auth orities confirmed the provisional measures and did not 
collect the difference between the amount estimated for the purpose of the security and the 
definitive duty that was determined to be higher . We therefore reject Indonesia's claim under 
Article 9.2 of the Anti -Dumping Agreement.  
7.201.   We further disagree with Indonesia's argument that the definitive collection of provisional 
duties is inconsistent with the obligation in the chapeau  of Article 9.3  of the Anti -Dumping 
Agreement  that the amount of the anti -dumping duty shall not exceed the margin of dumping as 
                                                
395 A panel previously found that t he provision "sources found to be dumped" in Article 9.2 is applicable 
in respect of provisional measures. (Panel Report, Canada – Welded Pipe , para. 7.77 ). 
396 See, e.g. European Union's first written submission, para. 144 ("Indonesia also raises consequent ial 
claims under Articles 9.3 and 9.2 of the Anti -Dumping Agreement, which apply mutatis mutandis to provisional 
measures as per Article 7.5 of the Anti -Dumping Agreement" .) We note that the European Union has argued 
that Indonesia should have brought a cl aim with respect to the provisional determination under Article 2 of the 
Anti-Dumping Agreement. (European Union's response to Panel question No. 49, para. 77; second written 
submission, para. 68 ). We do not exclude that a party may choose to bring a claim  directly under Article 2 in 
relation to provisionally estimated dumping margin or the imposition of the provisional duties. However, we do 
not consider the fact that Indonesia did not bring a claim under Article 2 prevents us from addressing its claims 
under Article 9 in relation to the provisional measures imposed on P.T . Musim Mas.  
397 Definitive Regulation, (Exhibit IDN -2), recital 227.  
398 We recall that Articles 7.1, 7.3, 7.4, and 7.5 all refer to the application of provisional measures, while 
Article 7.2  addresses the form which provisional measures that are applied may take.  WT/DS480/R  
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  established under Article 2 .399 We consider that the chapeau  of Article 9.3  is relevant in respect of 
the application of provisional measures , by virtue of Article 7.5 of the Anti -Dumping Agreement. 
This means the obligation is relevant at the time of the application of provisional measures . We 
understand Indonesia's  claim under the chapeau  of Article 9.3 is based on the same issue 
underlying i ts claim under Article 9.2, specifically, that the provisional anti -dumping duty applied 
to and definitively collected from P.T. Musim Mas was in fact higher than the provisional margin of 
dumping determined consistently with Article 2 of the Anti -Dumping Agreement. As noted above, 
at the time of imposition of provisional measures, pursuant to the first sentence of Article 7.2, the 
amount of provisional duty that is imposed, or security that is taken shall not exceed the 
provisionally estimated margin of du mping.  The EU authorities collected security equal to the 
margin of dumping that had been estimated at the provisional stage, and in this sense, the 
provisional duty amount did not exceed the margin of dumping at the time of application of  the 
provisional measures.  We therefore reject Indonesia's claim under the chapeau  of Article 9.3 of the 
Anti-Dumping Agreement.  
7.202.   Finally, in the context of addressing Indonesia's claims, we recall our findings in 
Sections  7.3.3    and 7.3.4   above that the European Union acted inconsistently with 
Articles  2.2.1. 1 and 2.2 of the Anti -Dumping Agreement and with Article VI:1(b)(ii) of the 
GATT  1994 in establishing the dumping margins in the Definitive Regulation . This was  due to the 
use of surrogate input prices in the construction of normal value for investigated Indonesian 
producers. We have observed that the substantial difference  between the provisional and definitive 
duties  is attributable to the change in the basis f or constructing the normal value at the definitive 
stage of the investigation .400 Had the European Union not substituted the recorded costs of 
producers the definitive duties for affected producers would not have been substantially higher 
than the provisiona l duties , if at all . Indonesia has submitted evidence in this proceeding to 
demonstrate that the provisional dumping margin for P.T. Musim Mas would have been negative, -
0.42%, had the EU authorities not committed the errors that are the subject of the pre sent claim. 
The European Union has not contested this evidence.401 This evidence before us thus supports the 
conclusion that  the definitive anti -dumping duty rate for P.T. Musim Mas would have been negative 
had the European Union not changed the basis for co nstructing the normal value at the definitive 
stage . This in turn presumably  would have had implications for the implementation of the relevant 
provision under Article 10.3 of the Anti -Dumping Agreement. We therefore note that our findings 
made in respect of Articles 2.2.1.1 and 2.2 of the Anti -Dumping Agreement and Article VI:1(b)(ii) 
of the GATT 1994 are relevant to  Indonesia's claims . 
7.8.4   Conclusions  
7.203.   We have addressed claims raised by Indonesia under Articles 7.1(ii), 7.2, 9.2 , and the 
chapeau  of Article 9.3  of the Anti -Dumping Agreement, in relation to the European Union's 
determination of a p rovisional margin  of dumping for P.T. Musim Mas that led to the subsequent 
application of provisional duties to P.T. Musim Mas and the definitive collection of those  duties. As 
set out above, we find that Indonesia has failed to establish a basis for its claims under Articles 7.2 
                                                
399 We note that Indonesia has argued that the "basis" of its claim is that the provisional dumping 
margin was not calculated in compliance with the disciplines set out in Article 2 of the Anti -Dumping 
Agreement. (Indonesia's response to Panel question No. 61 , para. 95). However, Indonesia has not identified 
particular provisions in Article 2 in respect of its claim, nor has Indonesia presented arguments in this 
proceeding in respect of how the errors made in constructing the normal value and export price viol ated 
particular obligations contained in the provisions of Article 2 of the Anti -Dumping Agreement.  
400 See para. 7.172.    above.  
401 Indonesia's first written submissi on, paras. 286 and 288; response to Panel question No. 119; 
P.T. Musim Mas dumping margin calculation by the European Union at the time of the final disclosure in the 
original investigation , (Exhibit IDN -37 (BCI));  and P.T. Musim Mas dumping margin calcula tion by Indonesia, 
(Exhibit  IDN-38 (BCI)) . Indonesia's calculation is additionally confirmed in the disclosure that was submitted as 
Exhibit IDN -36 in this proceeding. We recall that the European Commission initiated a review of the 
anti-dumping measures i mposed on imports of biodiesel originating in Argentina following the adoption of the 
panel and Appellate Body reports in the EU – Biodiesel (Argentina)  dispute.  In its notice of initiation  of the 
review , the European Commission indicated that it also cons idered it appropriate to review the anti -dumping 
measures imposed on imports of biodiesel from Indonesia. (See para. 2.3.   above ). In the disclosu re, the EU 
authorities recalculated the normal value for Argentine and Indonesian producers, including P.T. Musim Ma s 
based on the actual costs of the main raw materials as contained in the producer/exporter records. Although 
the content of this disclosure  does not constitute a final determination, recitals 40 and 87 confirm that the final 
definitive anti -dumping duty rate for P.T. Musim Mas would have been de minimis  or zero.  (See also 
European  Union's response to Panel question No. 120 ). WT/DS480/R  
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  and 7.1(ii) of the Anti -Dumping Agreement as concerns the definitive collection of provisional 
anti-dumping duties on imports from P.T. Musim M as, in the view that Indonesia does not 
challenge findings related to the imposition of provisional measures contained in the Provisional 
Regulation.  In addition, we reject Indonesia's claims that the European Union ac ted inconsistently 
with Article  9.2 or  the chapeau  of 9.3 of the Anti -Dumping Agreement.  
8  CONCLUSIONS AND RECO MMENDATION  
8.1.  For the reasons set forth in this Report, the Panel concludes as follows:  
a. the European Union acted inconsistently with Article 2.2.1.1 of the Anti -Dumping 
Agreement by failin g to calculate the cost of production of the product under 
investigation on the basis of the records kept by the producers; we do not reach findings 
as to whether, as a consequence, the European Union ac ted inconsistently with 
Article  2.2 of the Anti -Dumpi ng Agreement and Article VI:1(b)(ii) of the GATT 1994;  
b. the European Union acted inconsistently with Article 2.2 of the Anti -Dumping Agreement 
and Article VI:1(b)(ii) of the GATT  1994 by using a "cost" for the main input  that was not 
the cost prevailing "in the country of origin", Indonesia;  
c. the European Union acted inconsistently with Article s 2.2.2(iii ) and 2.2 of  the 
Anti-Dumping Agreement by  failing to determine "the profit normally realized by other 
exporters or prod ucers on sales of products of the same general category in the 
domestic market of the country of origin";  we reject Indonesia's request that we find 
that the European Union  additionally acted inconsistently with Article 2.2.2(iii) because 
the European Unio n failed to determine the amount for profit based on a "reasonable 
method " within the meaning of  Article 2.2.2(ii i) of the Anti -Dumping Agreement;  
d. the European Union acted inconsistently with Article 2.3 of the Anti -Dumping Agreement 
by failing to construc t the export price  of one Indonesian exporting producer, P.T. Musim 
Mas, on the basis of the price at which the imported biodiesel produced by P.T. Musim 
Mas was first resold to independent buyers in the European Union ; 
e. Indonesia has not established that t he European Union act ed inconsistently with 
Articles  3.1 and 3.2 of the Anti -Dumping Agreement, by relying on prices of CFPP 13 
biodiesel produced by the EU industry in calculating an adjustment to the price of 
Indonesian imports ; 
f. the European Union acted inconsistently with Articles 3.1 and 3.2 of the Anti -Dumping 
Agreement, by failing to establish the existence of significant price undercutting  with 
regard to Indonesian imports ; 
g. the European Union acted inconsistently with Article 9.3 of the Anti -Dumping Agreement 
and Article VI:2 of the GATT 1994  by imposing anti -dumping duties in excess of the 
margins of dumping that should have been established under Article 2 of the 
Anti-Dumping Agreement and Article VI:1 of the GATT 1994, respectively;   
h. Indonesia has not established that the European Union acted inconsistently with 
Article  7.1(ii) of the Anti -Dumping Agreement because it applied provisional measures to 
P.T. Musim Mas based on a WTO inconsistent preliminary determination of the existence 
of dumping for P.T. Musim Mas;  
i. Indonesia has not established that the European Union acted inconsistently with 
Article  7.2 of the Anti -Dumping Agreement because it applied to P.T. Musim Mas a 
provisional anti -dumping duty in excess of the provisionally estimated margin o f 
dumping for P.T. Musim Mas;  
j. Indonesia has not established that the European Union acted inconsistently with 
Article  9.2 of the Anti -Dumping Agreement because the provisional anti -dumping duty 
that was applied to P.T. Musim Mas and definitively collected was not in an "appropriate 
amount", within the meaning of Article 9.2; and  WT/DS480/R  
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  k. Indonesia has not established that the European Union acted inconsistently with 
Article  9.3 of the  Anti-Dumping Agreement by applying to P.T. Musim Mas  and 
definitively collecting a  provisional anti -dumping duty in excess of the provisionally 
estimated margin of dumping for this exporting producer . 
8.2.  Under Article 3.8 of the DSU, in cases where there is an infringement of the obligations 
assumed under a covered agreement, the action is  considered prima facie  to constitute a case of 
nullification or impairment. We conclude that, to the extent that the measures at issue are 
inconsistent with  the Anti -Dumping Agreement and the GATT 1994 , they have nullified or impaired 
benefits accruing to  Indonesia under these  agreement s. 
8.3.  Pursuant to Article 19.1 of the DSU, we recommend that the European Union  bring its 
measure s into conformity with its obligations under  the Anti -Dumping Agreement and the 
GATT  1994. Indonesia requests that we use our disc retion under the second sentence of the same 
article to suggest ways in which the European Union should bring its measures into conformity 
with the Anti -Dumping Agreement and the GATT 1994. Indonesia considers that the measures at 
issue in this dispute sho uld be withdrawn. We decline to exercise our discretion under the 
second  sentence of Article 19.1 of the DSU in the manner requested by Indonesia.  
 
 
__________