WTO panel to hear Russia case against EU energy package

24 July 2015

Russia’s complaint (DS476) over the EU’s Third Energy Package – a 2009 policy which sets common rules for transmission, distribution, supply, and storage of natural gas within the 28-nation bloc – has now advanced to the panel stage, after Moscow filed its second panel request on the subject at a meeting of the WTO's Dispute Settlement Body (DSB) held on 20 July. 

An earlier panel request had been rejected by Brussels in June, with the original consultations request being filed over a year ago. Russia has argued that these energy sector regulations violate trade rules by not according imports of Russian natural gas the same treatment as that to imports originating from third countries.

Furthermore, according to the panel request, Russia “considers that the [Third Energy Package], like the EU's natural gas and broader energy policy overall, unjustifiably restricts imports of natural gas originating in Russia and discriminates against Russian natural gas pipeline transport services and service suppliers.”

The EU reiterated at the 20 July DSB meet that its energy policies are in line with global trade rules, while repeating earlier concerns that Russia’s panel request has expanded the scope of the original complaint by including new measures and claims, according to sources familiar with the meeting. 

Indonesia requests panel in EU biodiesel case

Also at the 20 July DSB meeting, a first request by Indonesia for a panel be established in its complaint (DS480) against the EU’s anti-dumping duties on biodiesel imports was rejected, sources confirmed. Under WTO rules, a first request for a panel may be rejected by a respondent; however, should Indonesia re-submit the request, a panel will then be automatically established to hear the case.

The anti-dumping duties are already the subject of another dispute (DS473) lodged by Argentina against the EU, with that case currently undergoing review by a panel. A report in that case is expected by the end of this year, according to a communication circulated by the panel last December.

In its panel request, Jakarta raised questions over the “cost adjustment” methodology used by EU investigative authorities in the anti-dumping investigation, as well as citing various other concerns about how the probe was conducted.

The duties under scrutiny were confirmed by the EU in November 2013, following a 15-month European Commission investigation into claims that Argentina and Indonesia were exporting their energy product to the 28-nation bloc at a price below its normal value, a practice known as “dumping.”

While Argentina had filed its original consultations request in December 2013, Indonesia had followed suit several months later, in June 2014, and held consultations with the EU in July of that same year. 

Argentina and Indonesia together make up 90 percent of the EU’s biodiesel imports, as well as over 20 percent of the 28-nation bloc’s market share. The two countries are the world’s top suppliers of the fuel.

At the July DSB meeting, Indonesia reportedly reiterated its concerns over the cost adjustment methodology’s use in the investigation, sources said. The EU, for its part, reportedly noted that this panel request comes nearly a year since the two sides held consultations on the subject, and that panel proceedings are already well underway in the Argentina case on the issue.

ICTSD reporting.

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