This morning, the U.S. International Trade Commission (ITC) found that there is a reasonable indication that the U.S. photovoltaic industry is materially injured as part of the pending antidumping (AD) and countervailing duty (CVD) cases pertaining to crystalline silicon photovoltaic (PV) cells imported from China. This means that the U.S. Department of Commerce (Commerce), which had previously agreed to initiate AD and CVD investigations, will go forward with these investigations.

In general, an antidumping investigation focuses on whether imports are being sold in the United States at less than fair value, and a countervail investigation focuses on whether manufacturers, producers, or exporters receive countervailable government subsidies. These subsidies may include: grants; goods, services, or land for less than adequate remuneration; loans; tax benefits; export subsidies; and/or export guarantees and insurance.

In October, SolarWorld Industries America, supported by a group called the Coalition for American Solar Manufacturing, petitioned Commerce for the imposition of antidumping and countervailing duties on PV cells imported from China. The ITC instituted a preliminary investigation to determine whether there is a reasonable indication that a U.S. industry is injured or threatened by reason of these imports, which were alleged by the petition to be at less than fair value and to be subsidized by the Government of China.

As a result of its preliminary investigation, the ITC has voted unanimously (6-0) to continue these cases, making an affirmative finding in the preliminary injury investigation and clearing the way for Commerce to continue both investigations. The politically charged case is being fought in the midst of an economic downturn, with both sides staking out arguments related to the economic impact of the outcome of this case. On one hand, U.S. manufacturers are asking for a level playing field as compared to Chinese manufacturers, and on the other, solar developers are arguing that cheap PV from China has allowed PV installation and construction jobs in the United States to increase significantly. A group of U.S. companies has organized under the name of the Coalition for Affordable Solar Energy (CASE) to oppose the imposition of duties.

The next deadlines are in early 2012, with Commerce’s preliminary determination currently due on January 12, 2012, in the countervail case and March 27, 2012, in the dumping investigation. If Commerce determines that “critical circumstances” exist, it may decide to impose import duties retroactively to October 14, 2011, in the countervail case and December 28, 2011, in the dumping case.

This proceeding has great importance for both manufacturers of PV solar panels as well as for solar energy developers. It likewise has broad implications for the U.S. economy, international trade, and relations with China.

If you have questions or concerns regarding this alert, please contact any member of the the Energy and Project Finance Group.  


Copyright © 2011 by Ballard Spahr LLP.
www.ballardspahr.com
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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

 

 

 

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