Solarworld Gains EU Probes of Possible China Duty Evasion

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The European Union threatened to extend tariffs on solar panels from China to Taiwan and Malaysia, saying Chinese exporters may be using the two countries to evade the levies.

The European Commission, the 28-nation EU’s trade authority in Brussels, opened inquiries into whether Chinese exporters of solar panels shipped them via Taiwan and Malaysia to dodge EU duties meant to counter alleged below-cost -- or “dumped” -- imports and subsidies.

The probes, which can last as long as nine months, stem from April 15 requests by German solar-panel maker Solarworld AG, the commission said on Friday in the Official Journal.

The requests show that “a significant change in the pattern of trade involving exports from the People’s Republic of China, Malaysia and Taiwan to the union has taken place following the imposition of the measures, without sufficient due cause or economic justification for such a change other than the imposition of the duty,” the commission said.

The investigations are the latest signs of weaknesses in an EU-China agreement in late 2013 to curb European imports of Chinese solar panels. The accord, meant to end the EU’s biggest commercial dispute of its kind, set a minimum price and a volume limit on European imports of the renewable-energy technology until the end of 2015. Chinese manufacturers that opted to take part in the pact are spared EU anti-dumping and anti-subsidy duties.

Tariff Exemptions

The commission has threatened to revoke tariff exemptions for three groups of Chinese solar-panel producers, including Canadian Solar Inc. subsidiaries, because of possible breaches of the price-floor pact. It’s also considering whether to exclude Chinese prices from a benchmark that determines adjustments to the minimum import price in Europe.

As part of the circumvention probes announced on Friday, the commission ordered EU customs officials to register imports of solar panels from Taiwan and Malaysia. That step would allow duties on shipments from Taiwan and Malaysia to be applied retroactively should the investigations determine that circumvention by Chinese exporters took place.

European solar-industry group EU ProSun hailed the opening of the two inquiries, saying Chinese circumvention harms producers in Europe and deprives the region of customs revenue.

“Such circumvention is customs fraud and must be stopped,” Milan Nitzschke, the president of EU ProSun and a spokesman for Solarworld, said in an e-mailed statement in Brussels.

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