Countervailing, antidumping duties to be levied if injury to US found

Chinese companies are actively responding to the latest United States anti-dumping and anti-subsidy investigation in the solar products field, aiming to prove they did not damage the US solar industry.

"More than 90 Chinese companies are involved in the case. We are helping them to prepare materials. The priority is to prove they did not harm the US solar industry because it directly affects whether there will be additional duties and how high such duties may be," an unnamed source with the photovoltaic branch of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products said on Friday.

The US Department of Commerce said it initiated antidumping duty and countervailing duty investigations on Thursday. They will assess whether some solar products from the Chinese mainland and Taiwan are being sold in the United States below their fair value, or whether their manufacturers receive inappropriate levels of government subsidies, Reuters reported.

The investigations were triggered by a complaint at the end of last year by the US unit of German solar manufacturer SolarWorld. The company said it was meant to "close a loophole in trade remedies issued a year ago".

The US imposed anti-dumping and countervailing duties on crystalline silicon photovoltaic cells in October 2012. As a result, many companies tried to avoid the duties by assembling panels from cells produced elsewhere.

The US International Trade Commission, which is to carry out an inquiry process parallel to the Commerce Department, is scheduled to make a preliminary ruling by Feb 14 on whether there is a reasonable indication that imports from the Chinese mainland or Taiwan materially injure, or threaten to injure, the US industry.

A negative finding would stop the investigations, according to Reuters.

If the International Trade Commission determines the imports could be hurting the domestic industry, the US Commerce Department is scheduled to make preliminary determinations about subsidies in March and dumping in June.

Analysts said if SolarWorld's petition is approved, Chinese companies may be entirely blocked from the US market because high tariffs will make profits almost impossible from the former second largest export destination for Chinese solar product manufacturers.

"On the other hand, it is also negative to the development of the solar industry in the US if they blindly protect local companies with low-efficiency and cost-control abilities," said Sun Guangbin, secretary-general for solar energy and photovoltaic products at CCCME.

US-based downstream PV companies are major importers of modules fabricated in China but use non-Chinese solar cells for rooftop, commercial and utility-scale PV projects, to block the Chinese products outside. The move will hurt the whole green energy development in the US, Sun added.

The Coalition for Affordable Solar Energy, which claims to represent the majority of the US solar industry, had announced open opposition to SolarWorld's petition.

"SolarWorld is looking to single-handedly kill US solar jobs, which are primarily in solar installation, not in solar cell or panel manufacturing. Because of worldwide fair price competition, we have been able to significantly lower the cost of installing solar power across the nation's residential and commercial rooftops - which, in turn, has created more than 119,000 jobs to date, " said Jigar Shah, president of the Coalition for Affordable Solar Energy.

Shipments to the US, once the Chinese industry's second-largest export destination, have fallen 50 percent to about 10 percent of China's total solar cell exports. They may fall even further if new tariffs are imposed, analysts said.

Meanwhile, Chinese solar manufacturers are actively diversifying away from the US and EU markets to Japan, India and emerging economies such as South Africa as China promotes renewable energy to combat pollution

Trade in solar power products remains a thorn in the Sino-US trade relationship.

China's Commerce Ministry on Monday imposed five-year duties on solar-grade polysilicon imports from the United States and South Korea.