The dispute dates back to 2018, when the EU issued a directive restricting the inclusion of crop-based biofuels in member states’ renewable energy targets and set a roadmap to phase out palm oil-based biofuels by 2030, citing concerns over the sustainability of palm oil production.

Indonesia’s Trade Minister Budi Santoso has announced that the country will submit a request to the World Trade Organisation’s (WTO) Dispute Settlement Body seeking authorisation to suspend trade concessions toward the European Union (EU).

The move comes after the 27-member EU failed to meet the deadline to adjust its policies in line with a WTO ruling related to a dispute over palm oil.

In a press statement, Santoso said Indonesia was taking the step to protect its legitimate rights should the EU continue failing to comply with its obligations.

The dispute dates back to 2018, when the EU issued a directive restricting the inclusion of crop-based biofuels in member states’ renewable energy targets and set a roadmap to phase out palm oil-based biofuels by 2030, citing concerns over the sustainability of palm oil production.

As the world’s largest palm oil producer, Indonesia filed a complaint with the WTO in 2019 challenging the EU’s restrictions.
In January 2025, a WTO panel largely upheld the EU’s measures but issued several technical recommendations for adjustments. Indonesia said the WTO ruling included concessions in its favour and argued that the EU has not implemented those recommendations within the required timeframe.

Source: Vietnam+

• FAS accepting Viet Nam trade mission applications
• Regenerative agriculture paves way for coffee to meet EUDR and cut emissions
• Indonesia, Viet Nam Reaffirm $18 Billion Trade Goal, Sign Five-Year Action Plan
• Why this summer's heatwaves could raise your supermarket bill next year
• Viet Nam steps up investment and trade promotion with the Republic of Korea through business and investor connectivity