Diana Mariska, Jakarta – A European Union representative has said the economic bloc is prepared to receive any lawsuit directed against its recently announced tariffs on biodiesel import.
Earlier this week, the EU confirmed it would impose import tariffs on biodiesel from Indonesia, set at between eight percent and 18 percent in the next five years.
When asked about the possibility of Indonesian producers taking the matter to court, the new EU ambassador to Indonesia, Vincent Piket, said the union is well prepared for the scenario.
"We have set up a dispute settlement system to be used in a case like this. We abide by the ruling of the World Trade Organization's (WTO) dispute panel," Piket said to the media in Jakarta on Wednesday.
Piket said subsidies given to Indonesian palm oil producers have created an unhealthy competition in the industry – the reason for the EU to impose the tariffs.
"The countervailing duty aims to compensate for the unfair advantage that [Indonesian] companies receive as a result of subsidies. As soon as the subsidies are withdrawn, then we have again a level-playing field for trade. Then, we have the solution that we are after," Piket said.
Piket said environmental concerns regarding palm oil-based biodiesel produced in Indonesia were another reason for the EU decision, which was taken after the European Commission announced Indonesian biodiesel did not "meet the criteria" for renewability.
"It's very technical, but has everything to do with deforestation and land conversion for the purpose of producing crops for biofuel," Piket said.
The EU, however, is open to change and discussion. Piket said the EU will meet with Indonesian stakeholders to discuss the matter in the early weeks of next year.
The EU also opens doors for any discussion with scientists from Indonesia, Malaysia and Colombia – three biggest palm oil producers in the world – and other interested parties to talk about the scientific diagnosis used in the EU system to assess biofuel's renewability.