German biofuels regulator links two companies to certification fraud

Germany's biofuels regulator has linked elusive companies to its latest biodiesel fraud investigation, stirring up concerns over a lack of due diligence in the renewable fuel market.

The German Federal Office of Agriculture and Food (BLE) announced on May 6 that it had permanently blocked an unnamed UAE-based Hydrotreated Vegetable Oil producer from its national biofuels database, Nabisy, for issuing fraudulent Proof of Sustainability (PoS).

According to the BLE statement, the European certification body, ISCC, previously gave notice on Jan. 8 that it had suspended the producer from its voluntary scheme for 48 months, citing a "lack of cooperation" with its integrity program.

According to ISCC records, the UAE's EcoSolution Limited was the only HVO producer withdrawn from the database in 2025, after its certificate became invalid on Jan. 8.

Audit documents made public by ISCC show that Latvia-based Certi W certified EcoSolution in September 2024 for having the capacity to produce HVO from a range of waste feedstocks, including used cooking oil, spent bleaching earth and palm oil mill effluent.

Platts was not able to find contact details to reach EcoSolution Limited.

According to the BLE, its investigation raised "strong suspicion" that the HVO producer in question did not exist, noting inconsistencies between its UAE credentials and a Hong Kong address listed in the company audit.

Dutch supplier

The German investigation also raised "considerable doubts" over the existence of a second, Netherlands-based supplier, which was the initial recipient of all the fraudulent Proof of Sustainability certificates, the BLE said.

The BLE did not name the Dutch company, which it said retains a valid ISCC certificate.

According to ISCC records, AEY Trading Limited, a Netherlands-based company, is linked to the same Hong Kong address as EcoSolution Limited, based on details of a separate audit conducted by Certi W.

Three ISCC certificates audited by Certi W have previously been terminated, and four have been withdrawn, according to the public database. A further 25 certificates audited by the company remain valid.

"All our audit activities are always carried out in compliance with the ISCC procedures," Giuseppe Lepore, CEO of Certi W told Platts on May 8, adding that the audit company was "not aware of the issue".

He called on "full operation of the UDB [Union Database] system" to support "honest operators in the supply chain," stating that the system would empower certification bodies to conduct cross-checks during audits and improve oversight.

The ISCC declined to comment. Platts was unable to obtain details to contact representatives from AEY Trading.

Market response

The biofuel fraud discovery has shaken the European market at a time of mounting uncertainty over the volumes of legitimate feedstock available.

In March, the European Commission announced that it was considering suspending its recognition of ISCC EU waste-based biofuels, though no decision has been taken.

Meanwhile, lobby groups have raised alarm over biofuel import volumes that outpace potential production capacities from lead producers such as China, Malaysia and Indonesia, and have called for stronger checks and balances that could tighten the market.

In a December 2024 briefing, Brussels-based Transport & Environment found that just 9% of ISCC-certified UCO collecting points from Europe's three largest foreign suppliers had received in-person audits, leaving the continent exposed to mass fraud.

Contrary to expectations, however, the BLE avoided producing a tightening effect on the German HVO market by reinstating impacted PoS licenses.

In its May 6 statement, the BLE said that it would unblock suspended PoS licenses associated with the fraudulent producer, aiming to protect user confidence.

Most market sources had expected implicated HVO volumes and derived THG tickets to be suspended following the news, while others criticized the move for setting a poor precedent in combating fraud.

"Bit of a strange dynamic in the market," said one Netherlands-based broker. "After the news of the PoS not being blocked, it means the product is not going out of the market, so you would expect prices to go down," he said.