The EU, among others, started pushing biofuels years ago in part as a way to sop up excess crop production and reduce petroleum imports. The blending of biofuels with fossil-derived transport fuels (ethanol w/ petrol, biodiesel w/ diesel) was also sold as a pro-climate policy. https://twitter.com/wto/status/1351556783517564928

As evidence began to emerge in the late 2000s that biofuels weren't all they were cracked up to be, and on a life-cycle basis could even result in HIGHER carbon emissions than fossil fuels -- depending on various factors -- the EU instituted sustainability criteria.

These sustainability criteria determined whether a biofuel could qualify to meet the mandated minimum blending levels that the EU had set, based on life-cycle assessments for each type of feedstock. They were, in effect, PPMs (criteria based on processes & production methods).

This text from Malaysia's request for consultations sums up what has happened since the late 2000s, and Malaysia's view:

"In 2018 and 2019, the EU adopted legislative measures that, in simple terms, define palm oil as an unsustainable feedstock for the production of biofuel.

"The EU further argues that only palm oil production entails a high risk of indirect land-use change ('ILUC'). On that basis, oil palm crop-based biofuels cannot be counted towards EU renewable energy targets.

"Generally speaking, the measures adopted by the EU, as well as the related measures adopted by EU Member States, confer unfair benefits to EU domestic producers of certain biofuel feedstocks, such as rapeseed oil and soy, and the biofuels produced therefrom, at the expense...

"... of palm oil and oil palm crop-based biofuels from Malaysia. These measures may also discriminate against Malaysian palm oil and oil palm crop-based biofuels in favour of 'like products' from third countries."

In my view, disputes over these sustainability criterial were bound to arise. The misstep was subsidizing & then mandating blending levels for biofuels in the first place, which created a policy-dependent industry that locked countries into keeping their producers in business.