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Investigation Finds Four Firms Evading Anti-Dumping Rules on Chinese Solar Panels

December 5, 2022 by Dan McCue
(Canadian Solar photo)

WASHINGTON — An investigation by the U.S. Commerce Department has found that four companies have been sending their products through Thailand, Vietnam and Cambodia in order to circumvent regulations aimed at curtailing the dumping of cheap Chinese solar cells and modules on the U.S. market.

The four companies named in a preliminary determination released by the department on Friday were Canadian Solar and Trina Solar, which have been transporting solar cells and models through Thailand, BYD Hong Kong, which has been utilizing Cambodia for the same purpose, and Vina Solar, which has allegedly been shipping the illicit cargo through Vietnam.

The companies were four of eight originally named in a complaint that caused widespread concern in the solar power industry amidst concerns it would freeze the sector at a time when demand for solar cells and modules is dramatically increasing.

In a statement issued Friday, Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, continued to pan the inquiry.

“We’re obviously disappointed that Commerce elected to exceed its legal authority. As a basic fact, solar cell and module manufacturing greatly exceed the anti-circumvention statute’s ‘minor or insignificant processing’ limitation,” Hopper said.

“The only good news here is that Commerce didn’t target all imports from the subject countries,” she said. “Nonetheless, this decision will strand billions of dollars’ worth of American clean energy investments and result in the significant loss of good-paying, American, clean energy jobs.” 

According to the department, the four companies accused of circumventing U.S. anti-dumping and countervailing duties on solar cells and modules from the People’s Republic of China transported their products to neighboring countries for minor processing before exporting them to the United States.

In releasing its preliminary findings, the department said the investigation underscored its commitment to holding China accountable for “trade distorting actions” that “undermine American industries.”

The department went on to say that additional companies who have been using Malaysia, Thailand and Vietnam to move their goods did not respond to its request for information and will also be found to be circumventing U.S. trade rules.

Because Commerce preliminarily found that circumvention was occurring through each of the four Southeast Asian countries, the department is making a “country-wide” circumvention finding, which simply designates the country as one through which solar cells and modules are being circumvented from the People’s Republic of China. 

Department officials, however, stressed that this does not constitute a ban on imports from those countries. 

Companies in these countries will be permitted to certify that they are not circumventing the AD/CVD orders, in which case the circumvention findings will not apply. 

With regard to the companies under investigation that were not circumventing the AD/CVD duties, no action will be taken as long as their production process and supply chain do not change. 

With the release of its preliminary findings, Commerce will now conduct in-person audits in the coming months to verify the information that was the basis of its finding.  

In addition, all parties are being given an opportunity to comment on Commerce’s finding, which Commerce will fully consider before issuing its final determination, which is currently scheduled for May 1, 2023.

Independent of Commerce’s final determination, a Presidential Proclamation issued on June 6, 2022, provided that duties will not be collected on any solar module and cell imports from these four countries until June 2024 — unless parties cannot certify that the imports will not be consumed in the U.S. market within six months of the entry date. 

The proclamation was issued in order to give U.S. solar importers sufficient time to adjust supply chains and ensure that sourcing isn’t occurring from companies found to be violating U.S. law.

While the Solar Energy Industries Association’s Hopper was happy the industry has a two-year reprieve, she said, “that window is quickly closing, and two years is simply not enough time to establish manufacturing supply chains that will meet U.S. solar demand.”

“This is a mistake we will have to deal with for the next several years,” Hopper said.

Public records on this investigation can be found here under case number A-570-979.

Dan can be reached at dan@thewellnews.com and @DanMcCue

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