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Anti-dumping Duties for Argentine and Indonesian Biofuel

As of 27 November 2013 the EU imposed definitive anti-dumping duties on imports of biodiesel from Argentina and Indonesia. The antidumping measures consist of an additional duty of on average 24.6% for Argentina and 18.9% for Indonesia. The measures are based on a decision taken this week by the Council, following a 15-month investigation carried out by the European Commission. It revealed that Argentine and Indonesian biodiesel producers were dumping their products on the EU market. The dumped exports had a significant negative effect on the financial and operational performance of European producers.

“The EU is open to Argentine and Indonesian exports but we should not stay idle and tolerate structural raw material distortions. We’re glad the Council adopted the Commission proposal which is based on an objective investigation in line with WTO law. Now we can be reassured that our green energy sector is not under threat and will continue developing to the benefit of all Europeans,” said EU Trade Spokesman John Clancy via a press release.

The Commission took great care to ensure transparency of the process that culminated in this week’s Council’s decision. All interested organizations, including raw material providers, producers, importers and users, had an opportunity to express their views during the investigation to ensure that the overall benefits of such measures go beyond any potential inconvenience. Following the so-called “lesser duty” rule, the duty rates to be imposed will be lower than the dumping margin itself and will instead be pitched at a level calculated sufficient to offset the injury suffered by the industry.

The definitive anti-dumping measures will apply for five years and, in addition to restoring fair competition, are expected to ensure the continued development of an innovative green energy sector in the EU.

According to the investigation’s findings, Argentine and Indonesian companies benefit from an unfair advantage because they have access to raw materials at prices that are artificially low compared to the world market prices available for the EU biodiesel producers. The reason for this are high export taxes imposed by Argentina and Indonesia on raw materials used in the biodiesel production (soya beans and soybean oil in Argentina and palm oil in Indonesia). The investigation found that the dumping margin for Argentina was between 41.9% and 49.2% and for Indonesia between 8.8% and 23.3%.

However, applying the EU “lesser duty rule”, the anti-dumping duties will for most exporting producers be imposed at the level of the injury margin which is for Argentina between 22% and 25.7% and for Indonesia between 8.8% and 20.5%. In other words, the duties were fixed not to constitute a punishment, but strictly to prevent further injury to the EU industry.

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