Three Canadian solar manufacturers — Silfab Solar, Heliene, and Canadian Solar — have filed a lawsuit with the US Court of International Trade in New York against Donald Trump’s imposition of 30% tariffs on all imported solar cells and modules, citing “immediate, severe, and irreversible injuries” for the Canadian solar industry.
Towards the end of January, US President Donald Trump agreed to impose a 30% tariff on all imported solar cells and modules, as well as washing machines (the two decisions were not connected, but the decision was made at the same time). The move was unsurprisingly heralded as disastrous for the US solar industry — with job losses expected to be in the range of 23,000 in the first year alone, and installations to be cut by 11% over five years — but in the last week we have seen international concerns take the form of legal action against the decision.
Earlier this month, China filed complaints with the World Trade Organization seeking talks on compensation with the United States for the recent tariffs imposed on both solar and washing machine exports under the claim that the United States decision to impose such steep tariffs is “not consistent with its obligations under the relevant provisions of” the General Agreement on Tariffs and Trade 1994 (GATT 1994), and the Safeguards Agreement.
Around the same time, three Canadian solar manufacturers filed a complaint (PDF) with the US Court of International Trade in New York claiming that the imposition of the solar tariff on Canadian solar products violates the Trade Act of 1974 and the North American Free Trade Agreement (NAFTA), and is seeking an injunction prohibiting the tariffs enforcement on Canadian solar imports.
The three companies filing the complaint — Silfab Solar, Heliene, and Canadian Solar, as well as its subsidiary Canadian Solar Solutions — claim, simply, that the 30% solar tariff on all solar cells and modules coming into the US should not apply to Canadian solar products. This claim is not without merit, however, and is nowhere near as petty as it might appear on first blush. Not only do they point to specific sections of the Trade Act of 1974 and NAFTA which, in theory, should have already excluded Canada from being affected by the tariff, but they raise the point that the investigation conducted by the International Trade Commission which led to Donald Trump’s decision to apply tariffs specifically highlighted that Canadian imports do not meet the requisite tests for a NAFTA country to be included in the tariff decision.
Additionally, Canadian imports of solar modules and cells do not constitute a “substantial share” of the total imports into the US or “contribute importantly to the serious injury” caused by solar imports which led to the investigation in the first place.
In other words, not only should Canada probably not have been included within the scope of the 30% solar tariff due to its status under the Trade Act of 1974 and NAFTA, but it was never Canadian imports that were the problem, and imposing the tariff on Canadian imports is throwing the blanket too wide.
The plaintiff companies are simply looking to be excluded from the tariff and are calling on the Court to expedite the process so as to prevent “immediate, severe, and irreversible injuries” — though they haven’t ruled out the possibility of seeking “further and additional relief as this Court may deem just and proper.”
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