Commission Implementing Regulation (EU) 2019/1344 of 12 August 2019 imposing a provisional countervailing duty on imports of biodiesel originating in Indonesia

(217) Similarly to import duty, also the payment of VAT due on imported goods is suspended until the finished goods are sold on the domestic market. If a product remains in the bonded zone (such as, machinery) or is directly exported the VAT is never due.

(218) Under this scheme, the import duty and VAT exemption is granted on imports of capital goods, such as machinery used in the production process of biodiesel, raw materials and spare parts.

(219) Concerning the information requested by the Commission in the course of the procedure regarding the Bonded Zones scheme, Wilmar did not fully cooperate with the Commission. The Commission therefore informed Wilmar that it might have to resort to the use of facts available under Article 28(1) of the basic Regulation when examining the existence and the extent of the alleged support granted to the biodiesel industry through the exemption of import duty on machineries and goods imported into the Bonded zone.

(220) In the deficiency letter sent on 15 February 2019, the Commission asked Wilmar to provide certain information concerning imports of inputs and machinery since the date of setting up of each of the related entities (biodiesel producers and the CPO suppliers). In its reply to the Deficiency Letter, Wilmar provided a partial reply to that information request, claiming that it encountered technical difficulties in collecting the full set of data requested. A similar explanation was given during the verification visit. The Commission was therefore able to verify only a limited set of data.

(221) Consequently, with regard to the alleged support granted to the biodiesel industry through the exemption of import duty on machineries and goods imported into a bonded zone, Wilmar did not provide the necessary information and evidence as requested by the Commission in its deficiency letter and during the verification visit.

(222) The absence of necessary and relevant information and/or documents as described above significantly impedes the investigation. Indeed, it caused serious difficulties for the Commission to arrive at accurate and substantiated findings with respect to this subsidy scheme.

(223) Wilmar commented that the information requested was in the first place not necessary within the meaning of Article 28 of the basic Regulation and that in any event the partial information it has submitted complied with Article 28(3) of the basic Regulation. Wilmar also claimed that it does not hold the information it did not provide.

(224) In this respect, the Commission observed that the claim that Wilmar could not track that information cannot be accepted as it depends on a technical issue making the retrieval of that information allegedly too burdensome to retrieve. The Commission therefore was of the view that the Wilmar Group is in possession of that information, and could have retrieved it to provide a complete reply to the deficiency letter.

(225) Secondly, the information requested is necessary, especially in light of the fact that a relevant amount of data concerning the amount of duty exempted on the import is missing entirely. This therefore prevents the Commission to determine the precise amount of subsidy received by the Wilmar Group under this scheme.

(226) The Commission further observed that Wilmar's claim that it did not further request that information is not acceptable. During the verification visit the Commission asked whether the missing information was available and took note that it was not.

(227) The Commission therefore partially relied on facts available for its findings regarding those aspects of the investigation in accordance with Article 28 of the basic Regulation.

(228) For the reason set out below, the Commission considered that the import duty exemption on machineries granted by the bonded zones scheme constitutes a financial contribution by the GOI to the exporting producers in the form of revenue forgone.

(229) As indicated above in recitals (216) to (218), undertakings in bonded zones enjoy (i) the exemption of import duty on imported machinery and raw materials, and (ii) the exemption of VAT on imported machinery and raw materials. Both import duty and VAT remain exempted until the imported good is sold on the domestic market. This means that companies in bonded zones may never pay neither import duty nor VAT on goods that never leave the bonded zone, such as machinery, or that are directly exported.

(230) The Commission also observed that all exporting producers benefitted from this scheme, exclusively when importing machinery and spare parts for their biodiesel plants. Since the main raw material for the production of biodiesel is in fact CPO, and CPO is all locally sourced, the potential amounts not collected on imported raw materials appear to be negligible.

(231) In light of the above, the Commission therefore observed that the exporting producers essentially never paid the import duty and the VAT on the machinery they imported. The machinery in fact, is imported into the relevant bonded zone for the purpose of setting up the production facility and once installed it never leaves the zone.

(232) Therefore, the Commission concluded that the exemption of import duties on imports of machinery and equipment amounts to revenue foregone or not collected in sense of Article 3(1)(ii) of the basic Regulation. With respect to the exemption of VAT, the Commission considered that the GOI also foregoes public revenue, since under normal circumstances, the exporting producers would pay the VAT first to the State and then they will compensate such VAT when selling domestically (53).

(233) The investigation showed that the machineries used in the Bonded Zones are generally imported and that once installed never leave the Bonded Zone. Hence the import duty on such machineries in effect never becomes payable. With respect to the VAT exemption on imported machineries and spare parts, the Commission found that exporting producers also benefited from retaining the advantage of cash availability (54).

(234) In light of the above, the Commission therefore considered that this scheme confers a benefit to the exporting producers as they are placed in a better financial position than they would be absent the scheme. In fact, absent the scheme they would have paid the duty and VAT upon importation of the machineries and spare parts.

(235) The scheme is specific because it is available only to certain companies depending on their export performance and location in specific geographic areas within the jurisdiction of the granting authority, in accordance with Articles 4(2)(a) and 4(3) of the basic Regulation.

(236) The Commission found that through a set of measures the GOI provided support to the biodiesel industry including through the revenue forgone relating to the Bonded Zone scheme and the exemption of import duty and VAT on imported machineries and spare parts. The GOI conferred a benefit to the recipients which is specific, thus amounting to a countervailable subsidy.

(237) The Commission calculated the benefit to the exporting producers deriving from this scheme with regard to the exemption of import duty on imported machinery as the total amount of unpaid duty, allocated to the IP on the basis of the useful life of the underlying assets. With regard to the exemption of VAT on imported machinery and raw materials the benefit was negligible and therefore did not materially affect the final results.

(239) The Complaint identified a number of additional subsidies and subsidy programmes, and particularly, through revenue forgone or not collected such as income tax benefits for listed investments, industrial estate subsidies, pioneer industry tax benefits and the provision of export financing and guarantees on preferential terms by the Indonesian Eximbank.

(240) As the Commission did not find evidence of any exporting producers making use of them, they will be all treated together in this section.

(242) The investigation broadly confirmed the claims laid down in the Complaint. The investigation in fact revealed that the program was established on January 1, 2007, pursuant to Government Regulation No. 1/2007 and was renewed and modified on April 6, 2015 by Government Regulation No. 18/2015, which was later amended by Government Regulation No. 9/2016. Although Government Regulation No. 18/2015 repeals Government Regulation No.1/2007, companies receiving benefits under Government Regulation No. 1/2017 could continue receiving such benefits until their original expiration date.

(244) During the verification visit, the GOI explained that the scheme is available for investments in regions other than Java or Sulawesi, and that the relevant location for eligibility is that where the investment is carried out and not where the seat of the company carrying out the investment is. The GOI also confirmed that the CPO value chain, including biodiesel producers, is eligible for this scheme.

(245) The investigation showed that, for various reasons, none of the exporting producers made use of this scheme. Companies either were loss making and therefore they had no income tax to be deducted or not eligible due to not fulfilling the condition of specific region of the investments.

(246) As no exporting producer made use of the scheme the Commission did not further analyse this scheme.

(247) The Complainant claims that under the industrial estate scheme, the GoI subsidizes the Indonesian biodiesel producers through various incentives. Particularly, the Complaint claims that the GOI established the so called ‘industrial estate subsidy’ pursuant to Regulation No. 142/2015. Under this scheme, any ‘Industrial Company’ located in an ‘Industrial Estate’ is granted taxation incentives and may additionally be granted regional incentives.

(248) According to the Complaint, this programme provides a financial contribution to the Indonesian biodiesel producers in the form of revenue foregone by the GOI and provides a benefit to the Indonesian biodiesel exporters equal to the tax saving. Also, the Complaint claims that this scheme is specific since only certain enterprises within an industrial estate can qualify for the programme under the conditions laid down in the Regulation.

(249) The investigation indicated that this scheme has been set up by the GOI to support the industry activity established in specific geographical areas, defined by Article 1.4 of Government Regulation No. 142 of 2015 as a central industry activity zone which is equipped with supporting infrastructure developed and managed by the Industrial Estate Company..

(250) The investigation also indicated that this scheme may provide benefit to the recipients as Ministry of Finance Regulation 105/2016 provides for certain facilities on corporate income tax, as well as VAT and import duty exemptions.

(251) The investigation however showed that none of the exporting producers have used this scheme and therefore the Commission did not further analyse this scheme.

(252) The Complaint claims that the pioneer industry tax benefits programme, the GoI provides a series of tax incentives to increase direct investment to the so-called ‘Pioneer Industries’. Particularly, the Complaint claims that this scheme was established in 2011 with Minister of Finance Regulation No. 130/2011. It was then revised several times. This programme has been recently revised on 29 March 2018 through Minister of Finance Regulation No. 35/2018.

(253) According to the Complaint, this scheme provides a financial contribution to the beneficiaries in the form of revenue forgone by the GOI as well as a benefit to the former in terms of tax savings.

(254) The investigation indicated that the scheme in object essentially consists of a corporate tax reduction for undertaking engaged in certain business activities (the so called Pioneer Industries) listed in Minister of Finance Regulation No 159/2015 as amended by Minister of Finance Regulation No.103/2016. The investigation also revealed that in addition to be active in a ‘pioneer industry’ as defined by the Ministry of Finance, undertakings, in order to be eligible for this scheme, must invest at least IDR 1 000 000 000 000,00 (one trillion rupiah) for all sectors of pioneer industries excluding the information, communication and technology (ICT) sector that introduces high technology. The corporations in the ICT sector could invest minimum IDR 500 000 000 000,00 (five hundred billion rupiah) to be eligible for the benefit. In addition to the above, some other eligibility criteria apply and namely depositing a minimum of 10 percent of the investment plan in Indonesian banks, maintaining a debt to equity ratio at least 4:1, and having the status of Indonesian legal entity since 15 August 2011.

(255) The investigation however showed that none of the exporting producers have used this scheme and therefore the Commission did not further analyse this scheme.

(256) The Complaint claims that Lempabaga Pembiyaan Ekspor Indonesia (‘Eximbank’), a 100 % state-owned bank acts as a Ministry of Finance's special financial institution intending to support Indonesia's foreign trade. According to the complainant, in this capacity, Eximbank provides preferential export financing to Indonesian palm oil downstream industries, which includes biodiesel producers.

(257) According to the Complaint, Eximbank's goal is to support the government policies in the framework of encouraging the national export programme by means of the provision of national export financing and that in its 2017 Annual report, Eximbank further indicated that it commits to actively support the Indonesian palm oil related industries, which form the main part of its client base.

(258) The Complaint further claims that the wide range of financial services, such as export financing, export guarantees, export insurance and advisory services provided by Eximbank qualify as financial contribution on the part of the GOI. The Complaint additionally adds that pursuant to Law 2/2009 indicates that the Eximbank's function is to provide financing for any transactions or project that is not viable for commercial banking for the purpose of boosting exports. In this context, the Complaint claims that according to Eximbank's 2017 Annual report, Eximbank held financing and receivable assets with nominal interest rates as low as 0 %, denominated both in Rupiah as well as in foreign currencies. The Complaint therefore claims that, despite not being able to precisely identify the interest rate applied by Eximbank to the biodiesel producers, it nonetheless claims that they would be below market price and therefore constitute a benefit in their favour.

(260) The investigation revealed that none of the exporting producers but one had a contractual relationship with Eximbank. Notwithstanding the above, the Commission verified all the loans entered into between the exporting producers and any state owned bank. In this regard, the Commission could verify that the interest rate applied by the state owned banks on loans is comparable to international benchmarks, both for the loans denominated in Indonesian Rupiahs (‘IDR’) and the loans denominated in US dollars. With regard to the loans denominated in IDRs, the Commission compared the interest rate payable by the exporting producers during the life of the loan with the yields of Indonesian bonds of similar duration as available on Bloomberg. The Commission observed that the two are comparable.

(261) Consequently, given the fact that the Commission did not establish that a benefit had been conferred by this scheme, it did not analyse further the scheme.

(262) The Commission calculated the amount of countervailable subsidies for each exporting producer in accordance with the provisions of the basic Regulation by examining each subsidy or subsidy programme, and added these figures together to calculate a total amount of subsidisation for each exporting producer for the investigation period. To calculate the overall subsidisation below, the Commission first calculated the percentage subsidisation, being the subsidy amount as a percentage of the company's total turnover. This percentage was then used to calculate the subsidy allocated to exports of the product concerned to the Union during the investigation period. The subsidy amount per tonne of product concerned exported to the Union during the investigation period was then calculated, and the margins below calculated as a percentage of the Costs, Insurance and Freight (‘CIF’) value of the same exports per tonne.

(264) During the investigation period, 44 producers in the Union that were members of the EBB and a further 196 known non-member producers manufactured the like product. All these producers constitute the ‘Union industry’ within the meaning of Article 9(1) of the basic Regulation.

(265) As indicated in recitals (17) to (20), the Commission selected three Union producers in the sample representing 18 % of the total Union production of the like product.

(266) The Commission established the total Union production of biodiesel during the investigation period at around 13 million tonnes based on information submitted by the EBB concerning the Union industry.

(267) The EBB compiles data concerning production that it receives from its members, which account for around 70 % of the biodiesel production in the Union. With regard to non-member producers accounting for around 30 % of the biodiesel production in the Union, it gathers the information concerning production from the relevant national industry associations and from other publicly available sources.

(269) Total Union production gradually increased by 11 % between 2015 and 2017. It remained stable between 2017 and the end of the investigation period. When compared to Union consumption indicated in table 4 below, the production of the Union industry did not keep up with demand, the difference being imported biodiesel.

(270) The Commission established the Union consumption of biodiesel by adding imports of biodiesel into the Union to the sales of the Union industry on the Union market.

(272) The Union's biodiesel consumption was stable until 2016. It increased in 2017 and the investigation period by 33 % as compared with 2015. The consumption of biodiesel depends on two major factors, the consumption of diesel fuel and the content of biodiesel in this fuel.

(273) The steadily increasing demand and the Union production results from the energy policy of the Union. The Renewable Energy Directive 2009/285 (‘the RED’) (55) established that ‘each Member State shall ensure that the share of energy from renewable sources in all forms of transport in 2020 is at least 10 % of the final consumption of energy in transport in that Member State’ (‘blending mandate’). The Directive allows each Member State to set their own country-specific mandates.

(274) The Second Renewable Energy Directive 2018/2001 (‘RED II’) was published on 21 December 2018 (56), after the end of the investigation period. The Directive continues the policy of renewable fuels being used in the transport sector, continues the target of 10 % renewables in transport, and sets out biofuels sustainability criteria for all biofuels produced or consumed in the EU

(275) The fact that more biodiesel is being mixed into mineral diesel is an important element in the analysis of biodiesel market trends in the Union. The cost of production and prices of biodiesel are generally higher than the cost of production and prices of mineral diesel. The EU legislation makes producers of fuels (refineries) purchase biodiesel to mix it with fossil-based fuel.

(276) The consumption of biodiesel is directly linked to measures introduced in each Member State in order to comply with the blending mandate to mix certain levels of biodiesel in fossil fuels. The consumption of biodiesel is set to increase as and when more Member States transpose EU directive targets into their national legislation.

(277) Another important factor relates to the consumption of diesel fuel for road transport in the Union. This consumption is driven by the Union's general economic situation, which drives the need to transport goods and persons.

(278) Another factor relating to the consumption of diesel fuel (and as a consequence biodiesel) in the Union is the fuel efficiency of the diesel trucks, buses and diesel cars. Higher fuel efficiency directly leads to a lower diesel consumption. Another factor is a switch from diesel engines to engines using other types of fuel, such as petrol, LPG/CNG, hybrid and fully electric engines.

(279) The Commission established the volume of biodiesel imports and their market share based on Surveillance 2 (57) database.

(281) Because of the anti-dumping duties concerning imports from Indonesia imposed on 26 November 2013 by Regulation (EU) 1194/2013 (58), there were only minor imports from Indonesia to the Union between 2015 and February 2018.

(282) However, these duties were annulled by a judgment of the European Court of Justice in March 2018 (59) and as a result, imports increased dramatically thereafter as can be seen in Table 6.

(284) During the IP, there was a difference of around 15 % between those import prices and the EU sales prices (Table 10). From 2015 to 2017 the difference was between 5 % and 10 %.

(286) The Commission made price comparisons on a type-by-type basis for transactions at the same level of trade, duly adjusted where necessary, and after deduction of rebates and discounts.

(287) The comparison on a type-by-type basis focused on a comparison of the CFPP, irrespective of the feedstock used. Another characteristic that the Commission took into account was whether a product was subject to ‘double-counting’ in most Member States. For Germany, where a different way of calculating the efficiency of CO2 emission reduction is in place, the Commission also took into account this specificity of the German market.

(288) The Commission noted that some Indonesian exporters reported exports to the EU without a certificate (known as a ‘RED certificate’) which is required under the Renewable Energy Directive to allow the biodiesel to count towards the blending mandate in the EU. The Commission considered that these sales were in direct competition with Union industry sales with such a RED certificate, as these imports were in free circulation and the technical specifications of the product are the same.

(289) The Commission established that in most cases the final customer purchasing biodiesel is not aware of, nor concerned by, the feedstock that was used in the production, but requires a product that fulfils a certain maximum CFPP level. This level would vary depending on the season and climatic conditions. During summer months and in warmer regions, higher CFPP levels can be sold, while lower CFPP level biodiesel is required during winter months and in colder regions.

(290) Given the higher CFPP level of pure PME (normally CFPP +13), it is not normally blended with mineral diesel by itself, but is usually mixed with other biodiesels with lower CFPP first to produce a blend at CFPP +5 or CFPP 0 which is then blended with mineral diesel.

(291) The amount of PME used in a blend depends on the season and location across Europe. In southern Europe CFPP –5 is used in the winter, and CFPP +5 in the summer. In northern Europe CFPP –10 is used in winter, and CFPP 0 in summer. The higher the CFPP, the larger the percentage of PME that can be used in the blend of biodiesels (60).

(292) To calculate price undercutting at the level of each exporting producer, the Commission first compared the imports from Indonesia, which are pure palm oil biodiesel, to the pure palm oil biodiesel sales of the Union industry.

(293) Consequently, that type of biodiesel sold by the Union industry was in direct competition with the biodiesel imported from Indonesia, in line with the WTO panel report on Biodiesel from Indonesia (61). That comparison covered around 20 % of all sales by the sampled Union producers. According to WTO case law, there is no requirement providing for any specific percentage of the domestic industry sales to be considered in the price effects analysis (62).

(294) The Commission expressed the result of this direct comparison of PME imports to PME sales as a percentage of the sampled Union producers' turnover of PME sales during the investigation period. It showed a weighted average undercutting margin by the imports of exporters from the country concerned on the Union market of between 6,0 % and 11,6 %.

(295) The remainder of the sales of the sampled Union producers have a lower CFPP, which allow these products to be used at lower temperatures. Because the above-mentioned comparison between Indonesian imports and Union industry sales only covered around 20 % of the sales of the sampled Union producers, the Commission made two other types of price comparisons to assess the reliability of this undercutting finding.

(296) In the second option, the Commission broadened the comparison by including biodiesel with a CFPP of around 0 degrees (‘FAME0’), the most common type of biodiesel sold by the sampled Union producers, in the comparison. For this purpose, the prices of FAME0 were adjusted downwards taking account of the market value of the difference in physical properties. This market value was assessed based on the price difference between FAME10 and FAME0 on the Union market. This comparison covered 55 % of all sales of the Union industry and showed undercutting of 7,4 %.

(297) This comparison takes into account that biodiesel at CFPP0 – FAME0 - is usually a blend of various types of biodiesel, often including up to 20 % of PME. The Commission therefore considered that the sales price of FAME0 on the Union market is affected by the price of the biodiesels blended to make it and therefore a comparison is appropriate, to check the like-for-like comparison.

(298) In the third option, the Commission compared all imports of the Indonesian exporting producers with all sales of the sampled Union producers, regardless of the product type. This comparison showed undercutting of 17,5 % (63).

(299) This comparison showed that imports of PME from Indonesia at subsidised prices would have the effect of lowering the price of most blends sold on the Union market.

(300) Consequently, all three types of price comparisons showed significant levels of price undercutting. Therefore, irrespective of the methodology used, the Commission provisionally established that the prices of Indonesian imports significantly undercut the prices of the Union industry.

(301) In addition, in recital (328) the Commission analysed whether the Union industry prices were depressed by the subsidised imports.

(302) In accordance with Article 8(5) of the basic Regulation, the examination of the impact of the dumped imports on the Union industry included an evaluation of all economic indicators having a bearing on the state of the Union industry during the period considered.

(303) As mentioned in recitals (17) to (20), sampling was used for the determination of injury and the negative impact on the level of the sales prices, quantities sold, market share and profits of the Union industry.

(304) For the injury determination, the Commission distinguished between macroeconomic and microeconomic injury indicators. The Commission evaluated the macroeconomic indicators based on data contained in the questionnaire replies from the sampled Union producers and based on the information provided by the EBB.

(305) The Commission verified the methodology of collection of data submitted by the EBB and that the information was supported by adequate documentation and research procedures.

(306) Both sets of data were found to be representative of the economic situation of the Union industry.

(307) The macroeconomic indicators are: production, production capacity, capacity utilisation, sales volume, market share, growth, employment, productivity, magnitude of the amount of subsidisation, and recovery from past subsidisation or dumping.

(308) The microeconomic indicators are: average unit prices, unit cost, labour costs, inventories, profitability, cash flow, investments, return on investments, and ability to raise capital.

(310) Production capacity increased slowly throughout the period considered, to take account of growing demand. However, since the Union industry was only able to benefit from the market growth to a very limited extent due to the significant increase in subsidised imports, in particular during the investigation period, the increase in production capacity is significantly lower than the demand growth.

(311) Similarly, as in the case of the information on production, in recital (309), the EBB compiles data concerning capacity from its members, including national associations, and with regard to non-members, it gathers the information concerning capacity from other publicly available sources.

(312) The production capacity figures do not include a significant part of capacity that is considered idle. The EBB explained that a number of installed biodiesel plants have not been operational for several years and should be considered as long-term out-of-use. These plants, although nominally installed, would only be able to restart production after investment in technical adaptation and after a significant period.

(313) Capacity utilisation of the Union industry increased by 3 percentage points from 74 % to 77 % in the period considered. The industry achieved the highest levels of capacity utilisation during 2017 and the investigation period.

(315) The Union industry's sales dropped between 2015 and 2016, increased in 2017 but then fell back slightly in the investigation period.

(316) The factors driving sales are the same factors driving Union consumption. Imports did not affect the sales level to a significant extent in the years 2015-2016, which was a reason for the rather stable levels of both sales and market share.

(317) The removal of duties on imports from Indonesia changed the picture of the market in 2018. After the removal of duties the Union industry significantly lost market share compared to 2016 (almost 15 %), in particular between 2017 and the investigation period.

(318) While the market in the Union was growing by 33 % during the period considered, the sales quantity and production of the Union industry increased by only 13 % and 11 % respectively. The Union industry was therefore only able to benefit from the market growth during the investigation period to a very limited extent, since a significant part of this growth was absorbed by increasing quantities of imports, such as the subsidised imports from Indonesia.

(320) Employment by the Union industry remained stable throughout the period considered. Productivity increased between 2016 and 2017 and then slightly decreased by four percentage points.

(321) The impact of the subsidised imports from Indonesia on the Union industry will likely be substantial, given the significant volumes and low prices of these imports.

(322) On 26 November 2013, the EU imposed definitive anti-dumping duties on imports of biodiesel from Indonesia. The duties ranged between 8.8 % and 20,5 %.

(323) As stated in recital (282), those anti-dumping duties were annulled in March 2018 and as a result, the imports from Indonesia started notably to increase. As noted in recital (280) the market share of Indonesian imports reached 3,3 % in the investigation period, almost exclusively in the second half of the investigation period.

(324) As a consequence of the increasing imports at low prices significantly undercutting or depressing the Union industry's prices, the Union industry lost market share and was not able to benefit from the market growth.

(326) The weighted average unit sales price of the sampled Union producers to unrelated customers increased by 16 % between 2015 and 2017. Prices subsequently decreased by 5 percentage points between 2017 and the investigation period.

(327) The unit cost of production of the sampled Union producers followed the trend of prices, and increased by 14 % between 2015 and 2017. Costs subsequently decreased by 5 percentage points between 2017 and the investigation period.

(328) The biodiesel market is a price-sensitive commodity market. In such a commodity market a price undercutting of around 10 % does exercise a significant downward pressure on prices. Due to this price pressure, the Union industry could not benefit from the decreasing costs during the investigation period, because it had to fully pass on this cost decrease to its customers to avoid an even larger loss of market share.

(329) As a result, the Union industry could not improve their unsatisfactory profit margin due to the price pressure exercised by significant quantities of low-priced subsidised imports in an otherwise favourable market situation.

(331) Average labour costs went down between 2015 and 2016, and subsequently remained stable until the end of the investigation period.

(333) Stock levels of the sampled Union remained relatively stable throughout the period considered. Given that the product concerned is sold in bulk, a single delivery can comprise a significant volume of more than 10 000 tonnes and can have a significant impact on the stock level, depending on the precise transaction date. Therefore the level of stocks is a less meaningful indicator for the Union industry.

(335) The Commission established the profitability of the three sampled Union producers by expressing the pre-tax net profit of the sales of the like product to unrelated customers in the Union as a percentage of the turnover of those sales. The profitability is based on cost of goods sold.

(336) The profitability was around break-even during the whole period considered, remaining below 1 % of turnover.

(337) In spite of low profit levels, the Union industry was generating a positive cash flow from its operations in the whole period considered. It was able to self-finance its activities.

(338) The Union industry continued to invest during the whole period considered. Investments strongly fluctuated during the whole period, reaching their highest level in 2017.

(339) The return on investments is the profit in percentage of the net book value of investments. The return on investment was low but positive while the industry was profitable, between 2016 and the end of the investigation period.

(340) The financial performance of the Union industry in terms of profits during the investigation period limited its ability to raise capital.

(341) Imports from Indonesia were negligible throughout the period considered until March 2018 when the existing anti-dumping duties were discontinued. As a result, during the investigation period the imports increased significantly reaching 3,3 %.

(342) Union consumption was constantly increasing during the period considered, reaching an increase by 33 % for the entire period. This positive development was only partially reflected in the Union industry production and sales volume which increased only by 11 % and 13 % respectively during the same period. As a result, the imports, including those from Indonesia, increased their market share.

(343) During the period considered the injury indicators showed a mixed picture. Production and sales of the Union industry to a certain extent followed the market demand, but were only able to benefit from the market growth towards the end of the period considered to a very limited extent.

(344) Investments fluctuated throughout the period considered. The number of employees in the Union industry remained stable throughout the period considered, which in combination with an increasing production led to an increasing productivity per employee.

(345) However, the profitability of the Union industry remained poor throughout the period considered. This indicates that the Union industry did not manage to reach the level of normal profitable operations.

(346) Despite an increase of sales and production, caused by increasing consumption, the Union industry did not show indications of improving its economic situation. Whilst not being conclusive on the existence of material injury during the investigation period, the Commission will examine whether there is, at the very least, a threat of material injury.

(347) In accordance with Article 8(8) of the basic Regulation, the Commission examined whether the subsidised imports from Indonesia constitute a threat of material injury to the Union industry.

(349) In recital (263), the Commission provisionally concluded on the existence of countervailable subsidies in accordance with the provisions of the basic Regulation. Those subsidies show that the imports of the product concerned benefit from governmental support. The significant undercutting and price depression found during the investigation period is expected to affect the delicate economic situation of the Union industry already observed during the investigation period even more negatively in the near future.

(350) Moreover, as explained in recital (203), the GOI's measures supporting the domestic biodiesel industry ensure that biodiesel exports remain very competitive because of the lower costs of obtaining CPO (as opposed to Union producers who cannot benefit from such low prices). It is therefore foreseeable that the subsidised imports of the product concerned, because of the nature of the GOI's support measures, will continue to negatively affect the Union industry's economic situation.

(351) There is a clear link between the sudden and substantial increase of imports to the Union market from Indonesia since March 2018 and the removal of the anti-dumping duties in the same month. This indicates the ability of the Indonesian exporting producers to quickly react to the changing market conditions.

(352) Therefore, in view of the attractiveness of the Union market for the Indonesian exports, the Commission considered that after the termination of anti-dumping duties in March 2018, the fact that the volume of biodiesel imports from Indonesia has increased significantly indicates the likelihood that such imports will continue to increase.

(353) According to information provided by the GOI, the production capacity of the Indonesian biodiesel producers significantly exceeds the domestic demand by around 300 %. More than half of this production capacity is spare capacity, which the Indonesian exporters will have to export if they want to increase their currently low capacity utilisation.

(354) The spare capacity of the Indonesian biodiesel producers during the investigation period is established at around 40 % of EU consumption. This figure is based on verified information provided by the GOI.

(355) In November 2017, the USA imposed provisional anti-dumping duties and countervailing duties against imports of biodiesel from Indonesia. They were largely confirmed by definitive duties in April 2018 ranging between 92 % and 277 % for the anti-dumping duties ranging between 34 % and 65 % for the countervailing duties.

(356) The magnitude of the level of duties imposed in the USA means this market will not be able to absorb a significant part of the Indonesian spare capacity. There are no other known export markets that could absorb the very large Indonesian spare capacity, since the USA and the Union together account for around two thirds of the global consumption of biodiesel.

(357) In the absence of other significant markets available to the Indonesian producers, they are likely to direct their spare capacities to the Union market, causing further injury to the Union industry.

(358) The biodiesel from Indonesia that arrived in the Union market during the investigation period was imported at substantially lower prices than the prices charged by the Union industry. As explained in recital (294), the Commission established weighted average undercutting margins for the investigation period of between 6,0 % and 11,6 %. A comparison of all product categories also shows undercutting of 15 % – 17,5 %.

(359) The evolution of level of inventories of the sampled Union producers is described in detail in recital (332). As explained, due to the fact that the product concerned is sold in bulk, the level of inventories is a less meaningful indicator for the threat of injury analysis.

(360) In view of the analysis of factors concerning the threat of injury listed in recital (348), the Commission concluded that the fragile economic condition of the Union industry is likely to be aggravated by the imminent and continuing subsidised imports of biodiesel from Indonesia, which supports a provisional finding of threat of injury under Article 8(8) of the basic Regulation.

(361) As stated in recital (280), there were only negligible imports to the Union from Indonesia in the years 2015-2017 as well as during the first months of the investigating period. However, the imports increased significantly during the second half of the investigation period. As indicated in recital (280) the market share of the Indonesian imports for the investigation period is 3,3 %. As shown in recital (294), the Indonesian biodiesel imports were undercutting the Union industry prices by at least 6,0 % to 11,6 % during the investigation period, and such undercutting could be even higher depending on the approach to be followed. The Commission also established that the Indonesian biodiesel imports depressed the Union industry prices during the investigation period.

(362) Due to the significant and sudden increase of the subsidised imports of Indonesian biodiesel at prices below those of the Union industry, the Union industry lost market share in the investigation period, and could not improve its unsatisfactory profit margin in an otherwise favourable market situation.

(363) Therefore, the Commission concluded that those subsidised imports had a negative impact on the situation of the Union industry.

(364) Moreover, not only do the Indonesian biodiesel producers have significant spare capacity, which can be directed to the Union, but the closure of the second biggest export market of Indonesia – the USA –has directed excess production from Indonesia to the Union, which constitutes 40 % of the worldwide consumption. Thus, the Union has become the most attractive destination for Indonesian subsidised imports of biodiesel, to the detriment of the Union industry.

(365) Therefore, the Commission considered that the subsidised imports of Indonesian biodiesel are causing a threat of material injury to the Union industry.

(366) The Commission also examined whether other known factors, individually or collectively, are capable of attenuating the causal link established between the subsidised imports and the threat of injury provisionally found to exist to the effect that such link would no longer be genuine and substantial.

(368) Imports from Argentina reached a market share of 2,8 % in 2017, increasing to almost 10 % during the investigation period. These imports were subject to an earlier investigation, which resulted in the imposition of a definitive countervailing duty (64) and the acceptance of undertaking offers (65) in February 2019. The investigation showed that, at that time, subsidised imports threatened to cause material injury to the Union industry at the end of the investigation period of that case, i.e. the end of 2017.

(369) Imports from Argentina were to a certain extent responsible for the negative development of some injury indicators, such as the loss of market share of the Union industry and their inability to fully benefit from the growing consumption in the Union during the investigation period. Notably, the average import price from Indonesia of 671 EUR per tonne in the investigation period was higher than the import price from Argentina during the investigation period, which was 621 EUR per tonne.

(370) However, the threat of injury from Argentinian imports in the past including their very low prices was addressed by imposing countervailing duties and accepting undertaking offers in February 2019. Therefore, Indonesian imports have become the main cause for a threat of injury to the Union industry since then and Argentinian imports do not weaken the causal link between the subsidized imports and threat of material injury to the effect of rendering the link non-genuine or non-substantial.

(371) Imports from Malaysia were at a stable level throughout the period considered with a market share between 2,4 % and 3,0 % and prices were considerably higher (899 EUR per tonne) than Indonesian prices (671 EUR per tonne), and even higher than the Union's sales prices. Therefore, they do not weaken the causal link.

(372) Imports from the PRC continuously increased during the period considered, reaching a market share of 1,7 % in the investigation period. However, imports from the PRC are considerably lower in volume than from Indonesia and prices from the PRC are considerably higher (778 EUR per tonne) than Indonesian prices (671 EUR per tonne). Therefore, they do not weaken the causal link.

(373) Imports from third countries other than Argentina, Indonesia, the PRC and Malaysia never exceeded a combined market share of 1,5 %. Therefore, none of these other countries could have had any significant influence on the Union industry, in particular given the limited quantities of such imports.

(374) Based on the above analysis, the Commission concluded that the imports from other countries did not weaken the causal link between the subsidized imports and the threat of injury to the Union industry during the investigation period.

(376) The level of exports of the Union industry was limited. It did not exceed 4 % of its sales in any year of the period considered. The export performance of the Union industry cannot have been weakening the causal link between the subsidised imports and the threat of injury.

(377) The Commission identified a link between the increasing imports of subsidised imports from Indonesia during the period considered and the threat of material injury.

(378) The Commission distinguished and separated the effects of all known factors on the situation of the Union industry from the injurious effects of the subsidised imports from Indonesia.

(379) The Commission found that the other identified factors such as imports from other third countries and export performance of the Union industry did not weaken the causal link, either individually or collectively. The Commission notes that while the subsidised imports from Argentina were also a factor contributing to the threat of injury during and shortly after the investigation period, this issue had been addressed in the meantime by imposing countervailing duties and accepting undertaking offers in February 2019.

(381) In accordance with Article 31 of the basic Regulation, the Commission examined whether it could clearly conclude that it was not in the Union interest to adopt countervailing measures corresponding to the total amount of countervailable subsidies in this case, despite the determination of injurious subsidisation. The Commission based the determination of the Union interest on an analysis of all the various interests involved, including those of the Union industry, importers and consumers.

(382) Biodiesel is an important element of an effort to reduce greenhouse gas emissions and improve the sustainability of the energy supply in the European Union.

(383) The Union industry mainly uses feedstock produced by Union agriculture. The upstream agricultural oil sector also largely depends on the biodiesel industry. Imports of biodiesel from Indonesia would therefore not only affect the biodiesel industry, but also the agricultural sector in the Union.

(384) The Commission found that the situation of the Union industry is fragile since it has not recovered from the dumping previously suffered. The Commission therefore provisionally concluded that the imposition of measures would be in the interest of the Union industry.

(385) As referred to in recital (22), only two unrelated importers replied to the questionnaire sent by the Commission. Both importers stated that they are against the imposition of measures. The importer Gunvor further commented that the situation of the Union industry is caused by an inefficient production system and management.

(386) The Commission observes that importers of biodiesel, including the two co-operating companies, are very often traders on the Union market that not only import and export biodiesel worldwide, but also trade biodiesel purchased from Union producers. Both co-operating importers purchase biodiesel from Indonesia, other third countries and the Union industry. They therefore only to a certain extent depend on supplies from Indonesia for their business operations.

(387) However, the Union producers, especially the larger ones, rely to a significant extent on their own distribution channels. The Commission therefore does not expect the importers would be able to fully replace the level of imports affected by measures with biodiesel purchased from Union producers.

(388) The Commission concluded that the imposition of duties would not be in the interest of importers. The possible negative effect on importers can however partially be balanced by the increased volume of trade of biodiesel purchased from the Union industry.

(389) No users or consumers cooperated with the investigation despite the explicit invitation to do so in the Notice of Initiation.

(390) Producers of diesel fuel, that is refineries, purchase the biodiesel, imported or produced by the Union industry. Due to the legal requirements referred to in recitals (273) and (274), refineries need to add biodiesel to the mineral diesel sold on the market.

(391) It is therefore the final consumer that would be affected should the price of diesel at the pump increase following imposition of measures. The price of mineral diesel is, with rare exemptions, lower than price of biodiesel. Given that the amount of biodiesel blended with mineral diesel is normally no more than 10 %, the negative effect of any price increase of biodiesel is diluted before being passed on to the consumer.

(392) Under Article 31(1) of the basic Regulation, special consideration shall be given to the need to eliminate the trade-distorting effects of injurious subsidisation and to restore effective competition.

(393) The investigation has established that the Indonesian producers sell significant quantities of subsidised biodiesel at artificially low prices to the Union market. If this situation continues, the Indonesian exporters will maintain their unfair competitive advantage, further weakening the already vulnerable situation of the Union industry. As a result, the subsidised Indonesian imports will increase their trade-distorting effects over time, and continue to deny a level playing field to the Union industry.

(394) The Commission provisionally concluded that the imposition of duties would have an effect of increasing consumer prices. However, because of the limited content of biodiesel in the final product purchased by consumers (typically no more than 10 %), this negative effect on the price of diesel fuel would only be a small proportion of the direct change in the price of biodiesel.

(395) On the basis of the above, the Commission provisionally concluded that there were no compelling reasons that it was not in the Union interest to impose countervailing measures corresponding to the total amount of countervailable subsidies on imports of biodiesel originating in Indonesia.

(396) On 22 May 2019 the complainants submitted a request for imports from Indonesia to be registered, under Article 24(5) of the basic Regulation.

(398) The Commission examined the request in the light of Article 16(4) of the basic Regulation which sets out the conditions for collecting duties on registered imports. The Commission's examination also took into account comments received on the request for registration from the GOI, from the importer Gunvor and from the Wilmar group of exporting producers.

(399) Article 16(4)(c) of the basic Regulation requires the Commission to consider whether there is sufficient evidence that there will be critical circumstances where, for the product concerned, injury which is difficult to repair is caused by massive imports in a relatively short period of a product benefitting from countervailable subsidies.

(400) In addition, Article 16(4)(d) of the basic Regulation requires the Commission to assess whether ‘it is deemed necessary, in order to preclude the recurrence of such injury, to assess countervailing duties retroactively on those imports’.

(401) As explained in section 4 above, the Commission did not conclude that the Union industry suffered from material injury during the investigation period. Rather, as explained in sections 5 and 6 above, the Commission found that there is a threat of injury caused by the subsidised imports.

(402) Consequently, the Commission could not determine that injury difficult to repair is caused by the subsidised imports in the sense of Article 16(4)(c) of the basic Regulation.

(403) The Commission therefore concluded that the conditions for registration were not met.

(404) Since the Commission had sufficient evidence that the requirement under Article 16(4)(c) is not met, the Commission did not register imports of biodiesel from Indonesia for the three week pre-disclosure period under Article 24(5a) of the basic Regulation.

(405) Based on the conclusions reached by the Commission on subsidisation, injury, causation and Union interest, and in accordance with Article 15(1) of the basic Regulation, a provisional countervailing duty should be imposed on imports of biodiesel originating in Indonesia.

(406) Provisional countervailing measures should be imposed on imports of biodiesel originating in Indonesia, in accordance with the rules in Article 12(1) of the basic Regulation which states that the provisional duty shall correspond to the total amount of countervailable subsidies as provisionally established.

(408) The individual company countervailing duty rates specified in this Regulation were established on the basis of the findings of this investigation. Therefore, they reflected the situation found during this investigation with respect to these companies. These duty rates are exclusively applicable to imports of the product concerned originating in the country concerned and produced by the named legal entities. Imports of the product concerned produced by any other company not specifically mentioned in the operative part of this Regulation, including entities related to those specifically mentioned, should be subject to the duty rate applicable to ‘all other companies’. They should not be subject to any of the individual countervailing duty rates.

(409) A company may request the application of these individual countervailing duty rates if it changes subsequently the name of its entity. The request must be addressed to the Commission (66). The request must contain all the relevant information enabling to demonstrate that the change does not affect the right of the company to benefit from the duty rate which applies to it. If the change of name of the company does not affect its right to benefit from the duty rate which applies to it, a notice informing about the change of name will be published in the Official Journal of the European Union.

(410) In accordance with Article 29a of the basic Regulation, the Commission informed interested parties about the planned imposition of provisional duties. This information was also made available to the general public via DG TRADE's website. Interested parties were given three working days to provide comments on the accuracy of the calculations specifically disclosed to them.

(411) Comments were received from the Wilmar Group, the Permata Group and P.T. Ciliandra Perkasa. The Commission took the comments into account that were considered of a clerical nature and corrected the rates accordingly.

(412) In the interests of sound administration, the Commission will invite the interested parties to submit written comments and/or to request a hearing with the Commission and/or the Hearing Officer in trade proceedings within a fixed deadline.

(413) The findings concerning the imposition of provisional duties are provisional and may be amended at the definitive stage of the investigation,

HAS ADOPTED THIS REGULATION:

Article 1

Article 2

Article 3

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

Article 1 shall apply for a period of four months.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 12 August 2019.

For the Commission The President Jean-Claude JUNCKER

(1) OJ L 176, 30.6.2016, p. 55.

(2) OJ C 439, 6.12.2018, p. 16.

(3) In this Regulation, mineral diesel refers to a fossil-based, conventional diesel.

(4) The verification of the unrelated importer, based in Switzerland, was conducted with regard to imports into the EU.

(5) MOPS (short for the Mean of Platts Singapore) is the average of a set of Singapore-based oil product price assessments published by S&P Global Platts.

(6) Appellate Body Report, United States – Definitive Anti-Dumping and Countervailing Duties on Certain Products from China, WT/DS379/AB, 11 March 2011, para. 317. See also Appellate Body Report, United States – Countervailing Duty Measures on Certain Products from China, WT/DS437/AB/RW, adopted 16 July 2019, para. 5.96.

(7) Pursuant to Article 13 of Regulation of the Minister of Energy and Mineral Resources 26/2006, the biodiesel producer shall enclose to the invoice the following documentation: (i) copy of Decision of the Directorate General of New Renewable Energy and Energy Conservation (‘EBTKE’) on behalf of the Minister that the company is allowed to participate in the procurement of biodiesel and the respective volume allocation of biodiesel based on the capacity of the respective producers; (ii) copy of contract for procurement of biodiesel between Pertamina and the relevant biodiesel producer; (iii) certificate signed by Pertamina and the relevant biodiesel producer, stamped by the GOI and including information about the place of delivery, the volume and type of biodiesel provided/distributed, and the amount of transport fees; and (iv) copy of the agreement between the Fund Management Agency and the relevant biodiesel producer.

(8) Appellate Body Report, United States – Definitive Anti-Dumping and Countervailing Duties on Certain Products from China, WT/DS379/AB/R, adopted 25 March 2011, DSR 2011:V, p. 2869, paras. 284 and 309.

(9) Appellate Body Report, United States – Final Countervailing Duty Determination with Respect to Certain Softwood Lumber from Canada – Recourse by Canada to Article 21.5 of the DSU, WT/DS257/AB/RW, adopted 20 December 2005, DSR 2005:XXIII, p. 11357, para. 52.

(10) See Appellate Body Reports, Canada – Certain Measures Affecting the Renewable Energy Generation Sector/Canada – Measures Relating to the Feed-in Tariff Program, WT/DS412/AB/R / WT/DS426/AB/R, adopted 24 May 2013, DSR 2013:I, p. 7, paras. 5.119 and 5.120.

(11) Panel Report, United States – Subsidies on Upland Cotton, WT/DS267/R, Add.1 to Add.3 and Corr.1, adopted 21 March 2005, as modified by Appellate Body Report WT/DS267/AB/R, DSR 2005:II, p. 299, para. 7.1116.

(12) WT/DS316/R of 30 June 2010, EC and certain Member States – Measure Affecting Trade In Large Civil Aircrafts, para 7.494.

(13) WT/DS316/R of 30 June 2010, EC and certain Member States – Measure Affecting Trade In Large Civil Aircrafts, para 7.495.

(14) According to recent data from the Indonesian central bank, no single economic activity accrues for more than 20 % of the Indonesian GDP. Sources at https://www.bi.go.id/en/iru/economic-data/real-sector/Contents/Default.aspx., accessed on 17.7.2019.

(15) For a similar analysis, see Commission Implementing Regulation (EU) 2016/387 of 17 March 2016 imposing a definitive countervailing duty on imports of tubes and pipes of ductile cast iron (also known as spheroidal graphite cast iron), originating in India (OJ L 73, 18.3.2016, p. 1).

(16) Panel Report, US – Export Restraints (WT/DS194/R), circulated on 29 June 2001, para. 8.29.

(17) WT/DS296/AB/R of 27 June 2005, United States – Countervailing Duty Investigation on Dynamic Random Access Memory Semiconductors (DRAMs) from Korea, para 110 and 111. WT/DS299/R of 17 June 2005, European Communities – Countervailing Measures on Dynamic Random Access Memory Chips from Korea, para 7.25 adopted a similar approach.

(18) WT/DS296/AB/R of 27 June 2005, United States – Countervailing Duty Investigation on Dynamic Random Access Memory Semiconductors (DRAMs) from Korea, para 7.38.

(19) Panel Report, US – Export Restraints (WT/DS194/R), circulated on 29 June 2001, paras. 8.33-8.34.

(20) Panel Report, US – Export Restraints, paras. 8.29-8.31.

(21) Appellate Body Report, US –DRAMS (WT/DS296/AB/R), circulated 27 June 2005, para. 116.

(22) Appellate Body Report, US –DRAMS, para. 115.

(23) Appellate Body Report, US – DRAMs, para. 112.

(24) See Panel Report, Korea – Commercial Vessels (WT/DS273/R), circulated on 7 May 2005, para. 7.373.

(25) Appellate Body Report, US – DRAMS (WT/DS296/A/R), para. 114.

(26) Appellate Body Report, US –DRAMS (WT/DS296/A/R), para. 124.

(27) US Decision Memorandum for the Preliminary Affirmative Determination of the Countervailing duty Investigation of Biodiesel from the Republic of Indonesia; August 21, 2017, C-560-831 Investigation, p. 15, footnote 95.

(28) See for a similar conclusion, idem, p. 15.

(29) Customs and Excise News Magazine, Volume 47, No. 9, September 2015.

(30) Export taxes and other restrictions on raw material and their limitation through free trade agreements: Impact on developing countries, 2016.

(31) Similarly, see judgement of the General Court of 10 April 2019, T-300/16, Jindal Saw, ECLI:EU:T:2019:235, para. 117.

(32) WT/DS379/AB/R (US – Anti-Dumping and Countervailing Duties on Certain Products from China), Appellate Body Report of 11 March 2011, DS 379, paragraph 318. See also WT/DS436/AB/R (US — Carbon Steel (India)), Appellate Body Report of 8 December 2014, paragraphs 4.9 - 4.10, 4.17 – 4.20 and WT/DS437/AB/R (United States – Countervailing Duty Measures on Certain Products from China) Appellate Body Report of 18 December 2014, paragraph 4.92; and Appellate Body Report, United States – Countervailing Duty Measures on Certain Products from China, WT/DS437/AB/RW, adopted 16 July 2019, para. 5.96.

(33) https://www.asianagri.com/en/medias/media/press-release/indonesian-oil-palm-estate-fund-agency-bpdpks-handed-the-idr-6-75-billion-of-replanting-fund-to-asian-agri-s-smallholders

(34) https://www.reuters.com/article/us-indonesia-palmoil/palm-oil-watchdog-to-create-separate-standards-for-smallholders-indonesia-director-idUSKCN1SU1DL

(35) https://www.theborneopost.com/2018/11/18/indonesia-boosts-domestic-palm-oil-consumption-as-currency-pressures-mount/

(36) See Panel Report, United States – Countervailing Duty Investigation on Dynamic Random Access Memory Semiconductors (Drams) from Korea, WT/DS296, 21 February 2005, footnote 57 (‘[W]e consider that the reference to functions “normally vested in the government” should also be understood to mean functions of taxation and revenue expenditure. (…) To the extent that loans and restructuring measures involve taxation or revenue expenditure, they are capable of falling within the scope of that provision’).

(37) Appellate Body Report, United States – Final Countervailing Duty Determination with Respect to Certain Softwood Lumber from Canada, WT/DS257/AB/R, adopted 17 February 2004, DSR 2004:II, p. 571, para. 52.

(38) Appellate Body Report, United States – Countervailing Duties on Certain Corrosion-Resistant Carbon Steel Flat Products from Germany, WT/DS213/AB/R and Corr.1, adopted 19 December 2002, DSR 2002:IX, p. 3779, para. 73, footnote 65.

(39) See Opinion of AG Van Gerven of 7 March 1989, Fediol v Commission, C-70/87, ECLI:EU:C:1989:110, footnote 33.

(40) Oxford English Dictionary online, entries I.5.b and I.10.

(41) GATT Panel on Subsidies and State Trading, Report on Subsidies, L/1160, 23 March 1960 (The panel agreed that ‘a system under which a government, by direct or indirect methods, maintains such a price by purchases and resale at a loss is a subsidy’).

(42) Oxford English Dictionary online, entry I.3.b.

(43) SCM Agreement, Article 15.4 (‘…whether there has been an increased burden on government support programmes’); see also Agreement on Agriculture, Article 6 and Annexes II and III (‘domestic support’).

(44) Panel Report, China – Countervailing and Anti-Dumping Duties on Grain Oriented Flat-Rolled Electrical Steel from the United States, WT/DS414/R and Add.1, adopted 16 November 2012, upheld by Appellate Body Report WT/DS414/AB/R, DSR 2012:XII, p. 6369, para. 7.86.

(45) ‘Potential’ effects refer to those effects which naturally follow from the overall architecture, design and structure of the measure, without the need of ‘observed’ or actual effects on the market.

(46) https://www.reuters.com/article/us-indonesia-biodiesel/indonesia-to-make-biodiesel-use-compulsory-from-september-1-official-idUSKBN1KM4WK, accessed on 17.7.2019.

(47) https://www.reuters.com/article/us-indonesia-biodiesel/indonesia-bets-big-on-biodiesel-to-limit-costs-of-oil-imports-idUSKBN1KS0CC, accessed on 17.7.2019.

(48) https://www.biofuelsdigest.com/bdigest/2019/01/08/indonesia-wants-to-push-for-power-production-from-palm-oil-biodiesel/, accessed on 17.7.2019.

(49) https://www.ofimagazine.com/news/indonesian-biodiesel-production-could-grow-by-40, accessed on 17.7.2019.

(50) https://jakartaglobe.id/context/indonesia-oil-palm-estate-fund-adequate-to-support-b20-biodiesel-policy/, accessed on 17.7.2019.

(51) Blending mandate enacted pursuant to Ministry of Energy and Mineral Resources regulation 12/2015.

(52) See WT/DS436/AB/R United States – Countervailing Measures on Certain Hot-Rolled Carbon Steel Flat Products From India, 8 December 2014, para. 4.244.

(53) Appellate Body Reports, Brazil – Certain Measures Concerning Taxation and Charges, WT/DS472/AB/R and Add.1/WT/DS497/AB/R and Add.1, adopted 11 January 2019, paras. 5.212 – 5.221.

(54) Panel Reports, Brazil – Certain Measures Concerning Taxation and Charges, WT/DS472/R, Add.1 and Corr.1/WT/DS497/R, Add.1 and Corr.1, adopted 11 January 2019, as modified by Appellate Body Reports WT/DS472/AB/R / WT/DS497/AB/R, paras. 7.491 – 7.494.

(55) Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources (OJ L 140, 5.6.2009, p. 16).

(56) Directive (EU) 2018/2001 of the European Parliament and of the Council of 11 December 2018 on the promotion of the use of energy from renewable sources (OJ L 328, 21.12.2018, p. 82).

(57) Database of specific products under ‘surveillance’ or monitoring imported into the Union customs territory maintained by the Directorate-General for Taxation and Customs Union.

(58) Council Implementing Regulation (EU) No 1194/2013 of 19 November 2013 imposing a definitive anti-dumping duty and collecting definitively the provisional duty imposed on imports of biodiesel originating in Argentina and Indonesia (OJ L 315, 26.11.2013, p. 2).

(59) On 15 September 2016, the General Court of the European Union (‘the General Court’) delivered judgments in cases T-80/14, T-111/14 to T-121/14 (5) and T-139/14 (6) (‘the judgments’) annulling Articles 1 and 2 of the definitive Regulation to the extent that they apply to the applicants in those cases (‘the exporting producers concerned’). The Council of the European Union had initially appealed the judgments. However, following the Council's decision to withdraw its appeals, the cases were removed from the European Court of Justice's Register on 2 and 5 March 2018 (Orders of the President of the Court of 15 February 2018 in Joined Cases C-602/16 P and C-607/16 P to C-609/16 P, and of 16 February 2018 in cases C-603/16 P to C-606/16 P). Consequently, the judgments became definitive and binding as from the date of their delivery.

(60) WT/DS480/R European Union - Anti-Dumping Measures on Biodiesel from Indonesia, para 7.152

(61) WT/DS480/R European Union - Anti-Dumping Measures on Biodiesel from Indonesia, paras 7.143-7.161.

(62) WT/DS480/R European Union - Anti-Dumping Measures on Biodiesel from Indonesia, para 7.160.

(63) In WT/DS480/R, para 7.160 Indonesia argued that a comparison between Indonesian imports and blended CFFP 0 biodiesel sold by the Union industry representing 37 % of all Union sales was insufficient. Indonesia further argued that the Commission should have compared the sales prices of the remaining 63 % of the Union sales. This comparison, like the price difference referred to in recital (284), confirms that there is significant undercutting during the IP.

(64) Commission Implementing Regulation (EU) 2019/244 of 11 February 2019 imposing a definitive countervailing duty on imports of biodiesel originating in Argentina (OJ L 40, 12.2.2019, p. 1).

(65) Commission Implementing Decision (EU) 2019/245 of 11 February 2019 accepting undertaking offers following the imposition of definitive countervailing duties on imports of biodiesel originating in Argentina (OJ L 40, 12.2.2019, p. 71).

(66) European Commission, Directorate-General for Trade, Directorate H, Rue de la Loi 170, 1040 Brussels, Belgium.