March 21, 2018 / 1:24 PM / in 3 months

EU scraps duty on most Argentina, Indonesia biodiesel: document

BRUSSELS (Reuters) - The European Union has removed duties on biodiesel imports for 13 Argentine and Indonesian producers following the end of legal proceedings at the European Court of Justice (ECJ), an EU document shows.

The bloc set anti-dumping duties on imports of the renewable fuel from the two countries in 2013, but faced a series of legal challenges at the ECJ and the World Trade Organization. Both bodies have ruled against the measures.

The EU appealed against a Sept 2016 ruling by the ECJ, but dropped that appeal earlier this year. This was registered by the court in February and the parties were notified earlier in March. The Commission’s tax database shows the duties removed.

Companies that had challenged the measures at the ECJ now no longer face duties. They include the Argentine arms of Bunge, Cargill [CARG.UL] and Louis Dreyfus [LOUDR.UL], as well as Molinos Rio de la Plata and Indonesia’s Ciliandra Perkasa [FISTRC.UL] and Indonesian arms of Wilmar.

They represent the vast bulk of biodiesel exports. Under EU law, importers can also claim back duties paid in the past.

Indonesia said the elimination of duties meant its businesses would be able to export to Europe again.

For the European Union, the world’s top producer of biodiesel, rising shipments from Argentina and Indonesia threaten to cripple output, particularly after the United States imposed import duties of more than 70 percent.

Both countries impose an export duty on the raw material - soybeans for Argentina and palm oil for Indonesia - which the EU said means biodiesel producers in the two countries have lower costs than elsewhere, allowing them to “dump” product at unfairly low prices.

The EU had argued that the biodiesel markets in both countries were heavily regulated, so it needed to construct a “normal value” for the product, including a higher reference price for soybeans or palm oil and a reasonable profit margin.

Argentina and Indonesia called the resultant five-year anti-dumping measures protectionist.

The WTO has also ruled in favor of several challenges by Argentina and Indonesia to the anti-dumping duties.

The EU has since opened an investigation into whether Argentine biodiesel exporters benefit from unfair subsidies.

For companies that did not lodge a legal challenge at the ECJ, EU duties would still apply - of 166.95-178.85 euros ($205.08-219.70) per ton for Indonesia and of 62.52-79.56 euros per ton for Argentina.

The EU does still apply a general customs duty of 10.9 percent to third countries.

($1 = 0.8141 euros)

Reporting by Philip Blenkinsop, editing by Louise Heeavens

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