The biodiesel ‘war’ between EU and Argentina may enter a new chapter

EPA/PATRICK PLEUL

The biodiesel ‘war’ between EU and Argentina may enter a new chapter


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The European Biodiesel Board (EBB) is preparing to launch an anti-subsidy case against Argentinean biodiesel imports, following last week’s decision by the European Union to significantly lower anti-dumping duties for Argentina.

The EU Biodiesel industry is highly concerned about the impact that the Implementing Regulation 2017/1578 is having on the EU market. Therefore, a fast-track imposition of high-level countervailing duties will be necessary to prevent an influx of products from Argentina.

The revised anti-dumping duties on Argentinian biodiesel imports currently range from €43.18 to €79.56 per tonne (a much lower level than those set previously). The move has led to a major increase in the volumes of subsidised biodiesel exports from Argentina into EU markets.

The subsidies mean that Argentinian exporters can sell biodiesel at a price that is lower than the cost of the raw materials alone in the EU.

As such, the EBB fears severe damage to the EU biodiesel industry and related economic activities that are expected to worsen in the coming weeks and months.

This biodiesel “case” started with a legal complaint lodged by the EBB in 2012.

The definitive anti-dumping measures against unfair biodiesel imports from Argentina and Indonesia have been imposed for a period of five years via EU Regulation 1194/2013, published on 26 November 2013.

Argentina lodged a complaint at the WTO in December 2013. Following the WTO Appellate Body’s report that was published in October 2016, the European Commission was given until August 10 of this year to ensure the EU duties conform with the WTO Appellate Body’s report.

The EU and Argentina mutually agreed to postpone the deadline to September 28. In the meantime, and despite the EU industry’s strong disagreement, the EU decided to lower substantially the anti-dumping duties against Argentina, in order to conform with the WTO appellate body decision. This decision by the EU Commission came into force last week.

Following feedback from the EU Commission, the EU biodiesel industry is ready to act against the biodiesel trade flows from Argentina.

Considering the damage felt by the markets just a few days after the duties were lowered, the EBB says it is important to raise the attention of EU member state delegates and the European Commission on the absolute necessity of shortening all possible delays to starting the registration of all future imports. The EBB also called for the launch of an investigation and the speedy adoption of a provisional countervailing duty against Argentinean imports.

In a similar case, a “fast-track” duty adoption against unfairly priced exports from Argentina was recently implemented by US trade defence authorities. The EU biodiesel industry is hoping for a similar approach in the EU, if possible.

 

 

In an interview with New Europe, Raffaello Garofalo, EBB Secretary General, said: “This is a legitimate fight to protect the EU biodiesel market – and the 120,000 jobs it supports – from a heavily subsidised export-oriented industry.”

“We are prepared to do whatever it takes to limit the recurring Argentinian biodiesel imports therefore an EBB anti-subsidy complaint will be presented imminently,” added Garofalo. “In our view, it is essential that the registration of all incoming imports from Argentina starts as soon as possible and that a provisional duty is urgently established by EU Trade Defence authorities.”

At the same time, a fourth final delicate trilogue meeting next week will need to reach a compromise on the new EU anti-dumping rules.

The unsolved “hot point” in the negotiations is the so-called “burden of proof” that the European Parliament wants to “discharge” on the foreign exporters.

As such, the question remains: who has to prove the dumping?

Another issue is that the European Commission has rejected the European Parliament’s position on the burden of proof on the grounds that it would not be WTO-compatible.

And to complicate matters more, there is within the EU Council a “historical” confrontation between the southern producer countries, and the northern countries – always pushing for less trade defence measures.

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