U.S. International Trade Commission (ITC) judges Nov. 7 voted unanimously (6-0) that Chinese government subsidies to silicon photovoltaic (PV) cell and panel manufacturers violate World Trade Organization (WTO) rules by causing harm to their U.S. counterparts. The ITC panel voted against the Coalition of American Solar Manufactuers’ claim of critical circumstances, which would have seen countervailing and anti-dumping duties imposed retroactively to the date CASM originally filed its two petitions — October 19, 2011.
A Commerce Dept. WTO panel on Oct. 10 issued its final determination on anti-dumping duties to be imposed on imports of silicon PV cells and panels from China. The ITC’s ruling on Chinese government subsidies to its domestic manufacturers brings to a close what’s been a controversial, fiercely debated issue that’s divided the U.S. solar manufacturing industry into opposing camps represented by CASM on the one side and the Coalition for Affordable Solar Energy (CASE) on the other — at least in terms of U.S. international trade litigation.
Gaming International Trade
“Today’s unanimous vote by the International Trade Commission confirms what has been apparent in the marketplace for the past two years – Chinese manufacturers, with the enthusiastic support of the Chinese government, have attempted to game the international trading system in order to gain a virtual monopoly on solar cells and modules sales in the U.S. market,” commented Gordon Brinser, president of SolarWorld Industries America, the lead litigant in filing the two WTO petitions with the Commerce Dept.
“We have seen the results of this campaign in the marketplace, with more than a dozen companies either shutting down manufacturing facilities or significantly cutting back production and employment in the United States and a Chinese industry, led by LDK Solar and Suntech, having to increasingly turn to its national and provincial governments for help to survive.
“With this relief, combined with an aggressive domestic enforcement regime, there is hope that the United States can maintain a viable solar manufacturing base, conduct ongoing research and development and continue to make solar an increasingly viable part of the American renewable energy portfolio. On behalf of the membership of CASM, I want to thank the commissioners and the ITC staff for the hard work on this case.”
“Today’s expected decision by the ITC marks the end of a distracting and politically-charged trade case between the U.S. and China regarding imports of solar cells. Although this ruling was anticipated given the ITC’s low threshold for injury determinations, we are nevertheless disappointed that they have left in place the Commerce Department’s tariffs on solar cell imports. Fortunately, the scope of the decision is unchanged and is limited to solar cells produced in China, thereby minimizing harm to the U.S. solar industry,” CASE president Jigar Shah, a partner in Inerjys, a $1 billion fund that invests in clean energy via growth capital and project finance, stated in response to the ITC’s final determination.
“We will continue to encourage dialogue and negotiation between the U.S. and Chinese governments to seek a constructive resolution. Unilateral tariffs and a trade war in today’s interconnected global marketplace are unnecessary and detrimental to effective and efficient business competition.
“Going forward, we must avoid a repeat of the SolarWorld saga, as the growth of the solar industry here, in Europe, and around the world is too important to be upended by one company’s self-serving crusade. Fortunately, the scope of the decision is unchanged and is limited to solar cells produced in China, thereby minimizing harm to the U.S. solar industry.”
Commenting on the ITC’s finding against CASM’s claim of critical circumstance, CASE commented, “We are pleased that the ITC has determined that there were no critical circumstances, and thus no reason to apply the tariffs retroactively. This means that tariffs will not apply to modules made with Chinese cells that were imported into the U.S. during the period of the investigation.”
Solar PV & International Trade Litigation: More to Come
We haven’t heard the last on this issue, however. The European Commission on Sept. 7 decided it has received sufficient evidence from the EU ProSun group of European solar PV manufacturers to investigate claims that Chinese silicon PV wafer, cell and panel manufacturers are dumping product in the European Union (EU) market. Results are expected around June.
The Chinese government, for its part, on Nov. 5 filed a complaint with the WTO asserting that some European governments’ subsidies are in “violation of WTO prohibitions on import replacement subsidies, seriously affect Chinese exports, and harm China’s rightful interests as a WTO member,” according to a BBC News report.
Following, courtesy of CASE, is a table summarizing the preliminary and final determinations on anti-dumping and anti-subsidy duties imposed on Chinese silicon PV cell and panel imports to the US made by the ITC and Commerce Dept. panels.