RI Submits Suspension of Concession to the EU at the WTO regarding Palm Oil

JAKARTA - The Indonesian government has submitted a request for a suspension of concessions or other obligations to the World Trade Organization Dispute Settlement Body (DSB WTO) aimed at the European Union (EU) following the EU's failure to fulfill its obligations related to palm oil.

Trade Minister Budi Santoso said the move was taken after the EU could not meet the deadline to adjust its policies or fully comply with the ruling and recommendations of the Palm Oil Dispute Panel at the WTO (DS593: EU-Palm Oil).

"The suspension of concessions will be focused on the goods sector, but is open to other sectors. We will ensure that the amount of losses is calculated carefully and that the case is handled effectively while maintaining bilateral relations with the EU in parallel," said Budi as quoted by ANTARA, Saturday, March 7.

He said that the step of suspending the concession needed to be taken and in line with Article 22.2 Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU WTO), after the EU could not fulfill its obligation to adjust policies related to palm oil based on the decision and recommendations of the Palm Oil Dispute Panel.

In addition, the EU also cannot provide balanced compensation to Indonesia due to its inability to fulfill the WTO obligations.

"Indonesia can submit a request for suspension of concessions to the DSB with the aim of safeguarding Indonesia's rights in the future when the EU cannot comply with the WTO Panel's decision," said Budi.

He added that the steps taken by the Indonesian Government have also coordinated across government agencies and received support from business actors, including from the Indonesian Palm Oil Entrepreneurs Association (GAPKI) and the Indonesian Biofuel Manufacturers Association (APROBI).

According to him, the losses that have been calculated are very large for business actors per year due to the loss of export value potential.