The Dept. of Commerce today issued a letter to the American Solar Manufacturers Against Chinese Circumvention (A-SMACC) rejecting A-SMACC’s request for a tariff circumvention investigation into Chinese solar panel companies working in Southeast Asian countries.
A-SMACC first filed the petition in August, asking Commerce to review whether specific Chinese solar panel manufacturers were working in Malaysia, Thailand and Vietnam as a way to avoid antidumping and countervailing (AD/CV) duties issued on Chinese solar panel imports since 2012. A-SMACC filed the petition for an unknown number of anonymous companies, claiming that anonymity was warranted because of fear of retaliation from China.
Commerce’s reasoning behind today’s rejection of the petition was largely due to the anonymous nature of the involved parties.
“Not disclosing A-SMACC members’ names publicly hampers interested parties from fully commenting on the requests for circumvention inquiries and may hamper them from commenting on certain issues that could arise if Commerce were to initiate circumvention inquiries,” stated Abdelali Elouaradia, director of Commerce’s Office IV AD/CVD Operations, in today’s letter.
The decision comes as a relief to the U.S. solar installation community, which was predicting major job losses if excessive tariffs on imported solar panels delayed or altered utility-scale project plans. A-SMACC was requesting additional tariffs ranging from 50 to 250% on panel imports coming from the three countries — an area that supplied 80% of U.S. crystalline silicon solar module imports in the first half of 2021.
AD/CV duties have been in place against Chinese solar manufacturers since 2012. A-SMACC wanted a deeper look into specific Chinese companies working in the three mentioned countries as a possible way to avoid the duties:
- Malaysia: JinkoSolar, LONGi (and affiliates), JA Solar
- Thailand: Canadian Solar, Trina Solar, Talesun Solar, Astroenergy
- Vietnam: Trina Solar, Canadian Solar, Sunergy, Boviet Solar, GCL, LONGi (and affiliates), JinkoSolar
In 2015, Commerce completed a similar investigation into Chinese solar companies shifting production of solar cells to Taiwan as a way to avoid the antidumping tariffs, and Commerce did find the Taiwan operations at fault and tariffs were extended to the country. But since A-SMACC in 2021 asked for an investigation into specific companies rather than the countries as a whole, and since the business dealings of the anonymous petitioners are unknown, Commerce has rejected the petition because it does not meet the requirements of the Tariff Act of 1930.
“A-SMACC has not requested that Commerce conduct country-wide circumvention proceedings, but rather, it has indicated a preference for initiating the requested circumvention inquiries on a company-specific basis. Other interested parties with knowledge of the industry may wish to comment on A-SMACC’s preference for initiating the requested circumvention inquiries only with respect to certain companies located in the countries at issue. Any business relationships between A-SMACC’s members and companies that may have facilities in the countries at issue should not play a role in determining the companies covered by any circumvention proceedings,” Elouaradia stated.
Abigail Ross Hopper, president and CEO of solar industry advocacy group SEIA, celebrated the decision:
Today’s decision provides a rush of certainty for companies to keep their investments moving, hire more workers and deploy more clean energy. This is a critical time for climate progress, and we cannot afford to go backwards at a time when we need to be deploying more clean energy than ever.
As we’ve seen before, trade restrictions can cause irreparable harm to the solar industry. The circumvention petitions were one of many trade actions roiling the solar industry and some damage has already been done. SEIA will continue to monitor the ramifications of these harmful and unlawful circumvention petitions on the solar industry.
In the meantime, solar companies and workers can take a deep breath. Today’s decision, coupled with investments from the Build Back Better Act, will enable the solar industry to lead America’s transition to a prosperous clean energy future.
A-SMACC released a statement Nov. 15, as follows:
With that in mind, we are evaluating all options available to us under the trade remedy and other laws, including but not limited to refiling a petition satisfying the Commerce Department’s concerns. We urge the Commerce Department and the Administration to also consider all options to address unfair trade in the solar energy sector, including but not limited to self-initiation of further circumvention actions and trade cases. We stand ready to work with the Administration to strengthen U.S. manufacturing, R&D and supply chains in the critically important solar sector, while meeting our nation’s renewable energy goals. Above all, we will not cede monopoly power to China and to Chinese-owned companies on solar products. U.S. solar manufacturing is recovering, and the future is bright, but we should not have to compete with the unfair trade practices of China and Chinese-owned companies. We should ensure that America, which invented solar technology, leads the next generation of solar manufacturing, R&D, and deployment.
Updated Nov. 15 with additional comments.