The Palm Scribe

Malaysia Follows Suit, Files Legal Action Against EU to WTO for Discriminating Against Palm Oil

The world’s second largest palm oil producer, Malaysia will file legal actions against the European Union (EU) to the World Trade Organization (WTO) over discrimination by the regional organization against palm oil, a release received by The Palm Oil on Wednesday (1/6) said.

Malaysia’s Plantation Industries and Commodities Ministry (KPPK) and the Malaysian Attorney General’s Chamber will filed the actions against the EU through the WTO Dispute Settlement Mechanism, said the release that was sent to the Palm Scribe by the Council of Palm Oil Producing Countries (CPOPC.)

“The policies adopted by the EU in the Delegation Regulation under the European Union Renewable Energy Directive II (RED II) have created unreasonable restrictions on Malaysia’s sustainability efforts, and on free trade,” Plantation Industries and Commodities Minister Mohammad Khairuddin Aman Razali was quoted in  the release as saying.

He said that the EU policy was a discriminative action that has led to a negative impact on more than three million Malaysian people involved in the palm oil industry, including more than half a million oil palm smallholders.

Razali  also said that Malaysia will act as a third party in the case filed by Indonesia against the EU to the WTO  as a form of Malaysia’s solidarity and of its commitment to deal with anti-palm oil campaigns.

Indonesia, the world’s top palm oil producer which along with Malaysia supplies around 85 percent of global palm oil, filed its legal action against the EU in December 2019, accusing the regional organization of being discriminatory against palm oil.

The European Union passed the RED II in December 2018 and several months later passed a Delegated Resolution which is the implementing regulation for RED II.  In those regulations, the EU concluded that in general the cultivation of oil palm has led to massive deforestation and therefore the EU would gradually phase out the use of palm oil in biodiesel fuel for its transportation between 2023 and 2030.

The EU deemed that the cultivation of palm oil has led to a high level of indirect land use change (ILUC) and this had also led to high emission of glasshouse gases.

The press release said that the Delegated Regulation under the RED II was flawed in terms of honesty, scientific credibility and gave a wrong image of the sustainability efforts that have been undertaken by the palm oil industries in producing countries. The regulations were also deemed as being discriminatory against palm oil compared to the policies for other vegetable oils which were also used in the production of biodiesel fuel.

“Malaysia will continue to be committed in defending the interest of the country’s palm oil industry which has already contributed a lot to the socio economic development of the country,” Razali said in a closing statement.

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