US Commerce Department to Keep Chinese Solar Import Duties in Place

16 July 2015

The US Department of Commerce has completed an “administrative review” of duties on Chinese-made solar products, confirming that it will be keeping the 2012 duties in place, though at revised levels. The move comes as Beijing continues to face questions from some trading partners over the fairness of its trade practices regarding the solar energy sector.

The results were announced by the US agency last week, and addressed both anti-dumping and countervailing duties. While the former aims to address instances where goods are sold abroad at prices below their normal value, the latter aims to tackle instances where producers received unfair government support.

The duties at issue cover crystalline silicon photovoltaic products, including cells, modules, laminates, and panels from Chinese companies. The 2012 duties under review had fuelled a heated row between the US and China, and have repeatedly come under scrutiny in the years since their enactment. (See Bridges Weekly, 10 October 2012)

The administrative review concluded last week yielded mixed results for Chinese manufacturers. Yingli Green Energy Holding Co., for example, is now facing a 0.79 percent anti-dumping duty, a significant drop from the 24.28 percent rate under the 2012 decision. 

Some other companies, such as JinkoSolar, are set to face 9.67 percent duties, also down from 24.28 percent, while some other companies will face a 239 percent anti-dumping rate, lower than the 249.96 percent from before.

Regarding countervailing duties, most of these are now set at 20.94 percent, showing some slight increases from the October 2012 rates.

While SolarWorld Americas, which had backed the original anti-subsidy and anti-dumping complaints that led to the 2012 investigation, welcomed the news as a “strong victory” for US solar manufacturers, industry groups representing downstream producers that use these goods in their solar energy projects have harshly criticised the result.

“Uncertainty is sure to continue with more trade litigation, and all solar companies are paying the price. We urge SolarWorld to negotiate a reasonable solution with international manufacturers which can be implemented by the governments of the United States and China,” said Jigar Shah, the president of the Coalition for Affordable Solar Energy (CASE).

The administrative review focused only on the 2012 duties, and not on separate anti-dumping and countervailing duties on Chinese solar products that were confirmed earlier this year.

Those resulted from two separate investigations launched by the US Commerce Department in 2014 to determine whether some companies were attempting to avoid the 2012 duties by moving some of their production to Taiwan. (See Bridges Weekly, 30 January 2014 and 29 January 2015)

EU investigations underway

Along with the ongoing row with the US, the EU and China have repeatedly found themselves at loggerheads on renewable trade support practices, with a past disagreement on the subject potentially about to resurface.

Two years ago, Brussels reached a “price undertaking” deal with various Chinese solar exporters that exempted the latter from steep anti-dumping and countervailing duties, in exchange for a commitment to respect a minimum import price. (See Bridges Weekly, 5 September 2013)

However, in May the European Commission confirmed that it would be undertaking a “partial interim review” of the benchmark used as a reference for the price undertaking deal. Another probe was announced that month to see if Chinese exporters are skirting the existing duties through re-routing part of their production processes through Taiwan and Malaysia. (See Bridges Weekly, 7 May 2015)

Three Chinese producers were also removed from the price undertaking agreement earlier this year, with the Commission citing lack of compliance with the deal’s terms. These companies, together with those which did not participate in the original price undertaking deal, do face the anti-dumping and countervailing duties determined in 2013.

Along with the above-mentioned probes, another key issue that is set to come up between the EU and China in the months ahead is the expiration of both the price undertaking agreement and the anti-dumping and countervailing duties. These are all set to expire on 7 December of this year, unless an expiry review is requested by European industry.

Australia decision forthcoming

Separately, an announcement is also expected from Australian investigation authorities this Saturday on whether Chinese-made crystalline silicon photovoltaic modules or panels have been dumped onto the Australian market.

The investigation was launched by the Australian Anti-Dumping Commission in 2014, with a recommendation from the agency expected in October of that year. This period was then extended through 18 July 2015.

While a “statement of essential facts” released by the agency in April found evidence of dumping, it deemed that the evidence of injury to Australian producers was “negligible.” At the time, the Anti-Dumping Commission had requested that the investigation be terminated in light of this finding. (See Bridges Weekly, 16 April 2015)

However, the Australian-based Tindo Solar company has since claimed that the Chinese government has influenced domestic prices and costs for these PV modules and panels, such that selling prices in China are unsuitable in determining normal values. This, in turn, prompted the Commission to review whether a “particular market situation” exists in China, and extend the investigation further.

ICTSD reporting; “China Solar Adjustment Boosts Jinkosolar,” BARRONS, 10 July 2015; “US reviews 2012 China trade tariffs,” PVTECH, 9 July 2015; “U.S. Revises Tariffs and Duties on Chinese Solar Imports,” BLOOMBERG, 9 July 2015.

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