EU tariff forces Trina refocus

Chinese solar module developer Trina Solar is to service European customers through its overseas manufacturing facilities, because of EU duties on solar products imported from China.

Under a so-called price undertaking, Chinese companies have to sell solar cells and solar panels in the EU at a price above a fixed minimum import price (MIP).

Trina said that Chinese manufacturers that did not accept the terms of the agreement faced high anti-dumping and anti-subsidy duties, which for company were 47.7% and 3.5%, respectively, to be applied for a period of two years beginning on December 6, 2013.

At the time, Trina Solar said it chose to join the price undertaking as a participating company and has duly complied with its terms and conditions. 

However, it said the current interpretations of the price undertaking agreement by European Commission “unfairly limit the company’s growth potential in the European region, and are disruptive to the company’s ongoing global expansion strategy”.

Furthermore, Trina said, the Commission is to initiate a review investigation during which the anti-dumping, anti-subsidy and the price undertaking measures will remain in force.

“Trina Solar believes this is contrary to the principles of free and fair trade and it is in its best interest to exit the [price undertaking],” the company said.

Trina Solar chairman and chief executive officer Jifan Gao said: “We believe the current iteration of the [price undertaking] agreement misinterprets the rules and scope of the original [price undertaking], and adversely affects the execution of our global expansion strategy.

“In particular, the prohibition of manufacturing modules in overseas facilities, regardless of whether the modules will be sold to the EU or to non-EU markets is an obvious misapplication to the [price undertaking] agreement.

“Furthermore, we believe the current MIP does not reflect the ongoing market trends in the solar sector, particularly as average selling prices in major markets continue to decline at a faster than expected rate, with downward pressure anticipated to continue for the foreseeable future.

“Consequently, the Chinese companies that are party to the [price undertaking] have lost their competitiveness to their non-Chinese peers in selling to EU markets.”

Image: Trina Solar