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US drops investigation of alleged Chinese circumvention of solar cell, module tariffs

12 November 2021 Amena Saiyid Kevin Adler

A potential US investigation into claims of unfair trade practices by Chinese solar cell and module manufacturers by the US Department of Commerce will not proceed, the agency announced on 10 November.

The Commerce Department said on 29 September it was opening a 45-day inquiry after receiving a request in August from the American Solar Manufacturers Against Chinese Circumvention (A-SMACC) to investigate if Chinese exporters of critically needed materials are short-changing US manufacturers. But that request was made on behalf of three anonymous US producers, who said that they feared retaliation by China if they were named.

Without having the names of the three potentially affected companies, Commerce wrote to A-SMACC on 10 November that it cannot continue the inquiry.

The allegation stated that Chinese manufacturers were routing solar cells and modules through Malaysia, Thailand, Vietnam, and other countries—thereby "unlawfully circumventing antidumping and countervailing duties on China." Since 2012, US duties have been imposed on China's exports of solar cells and modules.

But Commerce told the complainants that the decision to keep the names of the companies private means that "counsel for other interested parties cannot consult with their clients about the A-SMACC members' role in the US market and their operations. Such consultation is particularly important in this case."

The Solar Energy Industries Association (SEIA) opposed the petition and said that the end of the inquiry will avoid harm to the US solar industry.

"The petitions were initiated by an anonymous group of companies, and if imposed, would have resulted in the loss of 46,000 solar jobs over the next two years," said SEIA President Abigail Ross Hopper in a prepared statement. "The petitions have already had a chilling effect on the industry's supply chain, and if imposed, we would have seen massive project cancellations and job losses within days."

Hopper added: "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."

Build Back Better is the complementary legislation to the infrastructure bill that was passed by the US Congress last week and will be signed next week by President Joe Biden. In current form, Build Back Better would add $555 billion in funding for the energy transition, climate adaptation, and related investments.

In addition to the tariffs in place since 2012, former President Donald Trump imposed via a January 2018 proclamation a 30% tariff on imported solar panels. That tariff, which survived a challenge at the World Trade Organization, phases down by five percentage points each year until it stabilizes at 15% in 2021. The tariff came on the heels of a case brought before the US International Trade Commission by US solar manufacturers Suniva and SolarWorld.

A separate Commerce Department investigation launched in September focusing on imports of rare earth permanent magnets used in wind turbines, electric vehicles, and fighter jet and missile guidance systems is ongoing.

Posted 12 November 2021 by Amena Saiyid, Senior Climate and Energy Research Analyst and

Kevin Adler, Chief Editor

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