EU Says Probe Finds Chinese Solar-Panel Makers Got Aid

The European Union said an investigation determined that Chinese solar-panel makers benefited from government subsidies, increasing the chance the EU will impose tariffs on imports from China of the renewable-energy technology.

The probe opened last November found that Chinese manufacturers of crystalline silicon photovoltaic modules or panels, and cells and wafers used in them, received preferential lending, tax programs and other assistance, according to the EU. The inquiry is one of two the EU has begun into alleged unfair Chinese trade in these solar goods.

The European Commission, the EU regulator in Brussels, on Aug. 2 approved an agreement with China to curb Chinese shipments of solar panels as part of a parallel probe into below-cost sales, a practice known as dumping. The accord, which took effect on Aug. 6, sets a minimum price and a volume limit on EU imports of Chinese solar panels until the end of 2015.

“All interested parties (including the government of China, exporters, EU producers, importers, suppliers and users) will have a period of time to comment on these findings,” John Clancy, spokesman for EU Trade Commissioner Karel De Gucht, said today in an e-mailed statement. “The commission will then consider these comments and determine what definitive action should be taken in the investigations.” He didn’t give a time frame for a decision.

EU Imports

“The disclosed findings in the anti-subsidy case do not undermine the amicable solution with China which resulted into the undertaking applied from the beginning of August in the context of the anti-dumping proceeding,” Clancy said in the statement.

The dumping and subsidy cases cover EU imports valued at 21 billion euros ($28 billion) in 2011. EU governments, acting on proposals from the commission, must decide by early December on any “definitive” measures against China, whose exporters control around 80 percent of the bloc’s solar-panel market.

The commission found that Chinese solar-panel makers receive subsidies amounting to 11.5 percent of their sales turnover, said EU ProSun, the industry group seeking definitive anti-dumping and anti-subsidy duties against China on behalf of around 40 European solar-panel producers including Solarworld AG (SWV) of Germany.

The group said the findings of Chinese state aid justify the imposition of anti-subsidy, or “countervailing” duties, in addition to the EU measures taken to counter dumping.

“Chinese subsidies have led to a Chinese takeover of the European solar market, resulting in numerous closures of European companies and factories,” Milan Nitzschke, president of EU ProSun, said in an e-mailed statement today. “We therefore call on the EU to impose countervailing duties to counter the effect of these illegal subsidies.”

To contact the reporters on this story: Jonathan Stearns in Brussels at jstearns2@bloomberg.net; Ewa Krukowska in Brussels at ekrukowska@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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