T

he Indonesian government has criticized the European Union (EU) for allegedly making discriminatory calculations of biodiesel prices and production costs, which resulted in higher anti-dumping duties for the country.

Oke Nurwan, the trade defense director with the Trade Ministry, confirmed on Monday that the government had officially filed a complaint over the issue at the end of October.

If the EU keeps on using the existing method of calculation, it will result in higher duties '€” potentially double the amount of duties that Indonesia has to pay for its biodiesel exports to Europe.

The amount of export duties is calculated based on some key variables, such as the prices of raw materials and production costs.

'€œWe think the way they [the EU] calculate the variables violates the rules of the World Trade Organization [WTO]. It has resulted in an unfavorable decision [in the form of higher duties] for Indonesia,'€ Oke told The Jakarta Post in an interview.

He added that the Indonesian government would also be prepared to defend the interests of its local biodiesel producers.

At the end of May this year, the EU imposed temporary anti-dumping duties, ranging from 2.8 percent to 9.6 percent, on Indonesia'€™s biodiesel.

The lowest duty was placed on major local palm oil industry group Musim Mas, while other companies, including Wilmar Bioenergi and Wilmar Nabati Indonesia were charged with the highest duty.

Earlier, the 28-member bloc accused the Indonesian government of providing a considerable amount of subsidies to local biodiesel producers.

However, in August the European Commission ruled in favor of Indonesia, freeing Indonesian biofuel from provisional countervailing duties after the Commission'€™s preliminary investigation showed no significant subsidy margins.

Last month the Commission dropped its probe into the case upon the request of its petitioner, the European Biodiesel Board, which also withdrew its complaint against Argentina.

Indonesian biofuel has often been criticized the country'€™s trading partners as its price is much more competitive compared to commodities from other sources thanks to the abundant supply of palm oil, which makes Indonesia the world'€™s biggest producer.

Palm oil-based biofuel is sold for US$200 per ton less than biofuel made with other types of vegetable oil, according to an estimate by industry group Indonesian Biofuel Producers Association (Aprobi).

Aprobi secretary general Paulus Tjakrawan said that several members of the industry affected by the EU duties had been prepared to file an appeal with the European Court of Justice.

'€œWe are ready to bring the case to the European Court of Justice. If we fail, we will move to the WTO,'€ he told the Post.

The European Commission was scheduled to announce its final findings on the case at the end of October. The ultimate ruling will either completely clear Indonesia any wrongdoing or turn the provisional duties into permanent levies if it proves that local producers were guilty of dumping.

Since the 1990s, compared to all of Indonesia'€™s trading partners, the 28-member bloc has filed the highest number of trade remedy complaints with the WTO against Indonesia.