Jakarta. Indonesia has urged the European Union or EU to lift its biodiesel import curbs after a panel ruling at the World Trade Organization (WTO). 

Just a few days ago, a WTO panel backed Jakarta’s claims that EU’s countervailing duties on Indonesian biodiesel imports were inconsistent with the organization’s rules in some key aspects. 

In August 2019, the EU began slapping anti-subsidy duties of 8 percent to 18 percent on imports of biodiesel from Indonesia. The WTO allows countries to impose these duties only if they have done an investigation that proves foreign governments have been subsidizing exported goods. Such duties mainly aim to offset the subsidies, thus providing a level playing field for foreign producers and their local counterparts.

An investigation by the European Commission claimed that Indonesian biodiesel producers had been enjoying tons of subsidies, be it through grants, tax benefits or easier access to raw materials -- all of which had enabled them to sell their products at a lower price. The commission also accused that these subsidized imports could threaten its producers.

The countervailing duties prompted Jakarta to sue the EU in 2023. A WTO panel later found that Europe had failed to make an objective examination in their investigation, particularly in regards to whether the imports could inflict material injury on European biodiesel producers.  

The WTO ruling is still open for appeal. However, the trade organization’s court that is in charge of reviewing the appeals is no longer functioning. The EU has yet to issue an official statement on the WTO ruling as of writing. However, Trade Minister Budi Santoso already said that Indonesia had already won the case.

“This win shows how the Indonesian government constantly abides by international trade rules without implementing policies that can distort international trade, as what the EU has accused us of doing,” Budi said in a press statement on Monday.

“We urge the EU to immediately remove the countervailing duties that are inconsistent with WTO’s rules.”

Chief Economic Affairs Minister Airlangga Hartarto recently called the EU a “key market for Indonesian palm oil products and biodiesel”. He was also confident that the panel ruling could provide an impetus for Indonesian exports. 

Data published by the palm oil producer association Gapki showed that Indonesia did not export any biodiesel so far this year as of June. The overall palm oil exports totaled nearly $17.3 billion in value, up from the $12.8 billion recorded in the first half of 2024. According to Gapki, Indonesia’s EU-bound palm oil exports saw a month-to-month increase of 10,000 tons in June 2025 alone.

The latest news came not long after Indonesia revealed that the EU would buy 1 million tons of crude palm oil a year at zero tariff. This tariff-rate quota is part of an upcoming free trade agreement.

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