US Commerce Dept confirms preliminary duties on China, Taiwan solar products

4 August 2014

The US Commerce Department confirmed preliminary anti-dumping duties on certain Chinese and Taiwanese solar products at the end of July. The move, coming just weeks after the government agency announced anti-subsidy duties on such products in a separate probe, has drawn a harsh rebuke from Beijing and is expected to worsen long-running tensions between the two sides on renewable energy trade.

The probe was launched in January, and specifically covers crystalline silicon photovoltaic (PV) cells, and the modules, laminates, and/or panels that use them. The US agency began the investigation following a petition by the American branch of SolarWorld Industries, which had claimed that Chinese producers were skirting an existing set of duties on these goods. (See BioRes, 7 February 2014)

SolarWorld had alleged that, in order to avoid the duties already in place, Chinese producers were using cells made abroad, primarily from Taiwan, in their production processes.

According to the US Commerce Department, the preliminary dumping margins for Chinese producers are set at rates between 26.33 to 58.87 percent, depending on the producer. The China-wide entity, meanwhile, received a preliminary dumping margin of 165.04 percent. Taiwanese producers received dumping margins between 27.59 percent and 44.18 percent.

The cash deposits that will be collected by customs officials on the Chinese goods are lower than these dumping margins, Commerce said, in order to adjust for the export and domestic subsidies that were found in the US agency’s separate countervailing duty investigation.

Under the latter countervailing duty probe, Chinese producers are facing preliminary duties of 18.56 to 32.51 percent. A final determination in that investigation is expected from Commerce by mid-August, unless a decision is made to extend the deadline. (See BioRes, 5 June 2014)

“We and our workers are gratified to hear that the US government once again has moved to block foreign government interference in our economy and clear the way for the domestic production industry to be able to compete on a level playing field,” said SolarWorld Industries America President Mukesh Dulani.

According to US statistics, Chinese imports of these solar products amounted to nearly 33 million units – the equivalent of US$1.49 billion – last year.

Trade litigation taking a toll, industry groups warn

Though US producers of these goods, such as SolarWorld, have welcomed the duties, industry officials representing many of the downstream producers that use these cells have been openly against the investigations.

The Coalition for Affordable Solar Energy (CASE), a group that represents various companies ranging from local installers to project developers, has been one of the most vocal critics, warning that these duties will hurt – rather than help – the American solar industry’s competitiveness.

Furthermore, the group says, trade litigation is only serving to heighten uncertainty in the comparatively new renewable energy market, and has pushed instead for a negotiated settlement.

“CASE members, which represent the industry majority, demand a solution that ends uncertainty in the marketplace by preventing further trade litigation and that allows solar power to compete cost-effectively with traditional energy sources,” said CASE president Jigar Shah.

A negotiated solution was reached in a similar row between the EU and China last year. However, European solar industry groups have since claimed that Chinese producers are violating the terms of the settlement, known as a “price undertaking” agreement, with EU officials now in the process of reviewing those claims.

Under the terms of the EU deal, participating Chinese exporters can export up to 7 gigawatts of solar products to the EU at a price of at least 53 cents per watt. While the US was reportedly involved in the original discussions for such an arrangement, it did not take part in the final deal. (See BioRes, 13 June 2014)

China lambasts investigation

The US Commerce Department announcement drew harsh criticism from the Chinese Ministry of Commerce, which warned that these duties would only harm downstream producers.

“Frequent trade remedy measures taken by the US PV industry cannot solve their own development problems,” Chinese commerce ministry officials said in a statement following the news.

Furthermore, the ministry said, the US investigation also ignored the facts and legal basis for conflicting rules of origin, constituting an “abuse” of trade remedy measures.

Final results due date

The final determinations are expected by 15 December of this year, Commerce said. Should those final determinations indicate dumping, the International Trade Commission (USITC) – another agency that is involved in US trade remedy investigations – will then examine whether such imports materially injure, or threaten to injure, US industry.

The deadline for the latter probe is 29 January 2015. If injury is found by USITC, then final anti-dumping orders will be issued. Otherwise, no duties will be applied.

ICTSD reporting.

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