The US Department of Commerce has ruled that four companies have been attempting to circumvent tariffs on Chinese solar cells and modules.
The department had been examining a complaint alleging that eight companies that manufacture solar cells and modules are in fact manufacturing the components in China, then sending those cells and modules to Cambodia, Malaysia, Thailand, and/or Vietnam for minor processing before being exported to the US.
Such actions amount to an effort to evade the existing antidumping duty and countervailing duty orders on solar cells and modules from China.
In its preliminary determinations, the department found that BYD Hong Kong in Cambodia, Trina and Canadian Solar in Thailand, and Vina Solar in Vietnam were circumventing tariffs.
In addition, it ruled that New East Solar, Hanwha, Jinko and Boviet had not attempted to circumvent tariffs.
Some companies in Malaysia, Thailand and Vietnam did not respond to the department’s request for information in this investigation, and consistent with longstanding practice, will be found to be circumventing.
Because the preliminarily determinations found that circumvention was occurring through each of the four countries, the department is making a “country-wide” circumvention finding.
This designates the country as one through which Chinese solar cells and modules are being circumvented.
Companies in these countries will be permitted to certify that they are not circumventing the anti-dumping and countervailing duty orders, in which case the circumvention findings will not apply.
The next step will see the Department of Commerce conduct in-person audits in the coming months to verify the information that was the basis of its finding.
Commenting on the news, President and CEO of the American Council on Renewable Energy (ACORE) Gregory Wetstone said: “The preliminary decision on solar tariffs from the Department of Commerce creates new challenges that threaten to undermine Biden administration efforts to address climate change and accelerate the clean energy transition.
“With today’s decision, the Commerce Department appears to be doubling down on constricting solar availability, and imposing massive new red tape with certification requirements that could further chill the industry and thwart the administration’s clean energy objectives.”
He added: “The good news is that we look forward to the development of an enhanced domestic solar manufacturing base over the next few years, spurred in part by the incentives in the Inflation Reduction Act. But that will not happen overnight.
“Like most sectors of the American economy, the solar industry has a global supply chain and a business model that relies on stable policies and predictable pricing.
“Today’s decision will limit our ability to fortify our supply chain and reflects the dramatic shift from ‘free trade’ policies to protectionism in both parties. American consumers, and the effort to protect our climate, are unfortunately caught in the middle.”