In April 2024, the American Alliance for Solar Manufacturing Trade Committee (the Petitioner), a coalition representing leading U.S. solar manufacturers (Convalt Energy, First Solar, Meyer Burger, Mission Solar, Qcells, REC Silicon and Swift Solar), petitioned the U.S. Department of Commerce (DOC) and the U.S. International Trade Commission (ITC) to further combat the practice of “dumping” — i.e., exporting a product at a price that is lower than the market price domestically — crystalline silicon photovoltaic (CSPV) cells from Cambodia, Malaysia, Thailand and Vietnam (the Subject Countries). In its antidumping and countervailing duty petition (the Petition), the Petitioner alleges that the CSPV dumping practices of the Subject Countries undercut domestic manufacturing efforts and materially injure the U.S. solar manufacturing industry. The Petitioner seeks relief against Chinese influence of the market and against unfair trade practices of Chinese-owned solar manufacturers in the Subject Countries. In response, the DOC and ITC have opened preliminary investigations to review the Petitioner’s allegations.
Dumping occurs when a manufacturer exports a product to another country and charges a price that is lower than (i) the price it charges domestically or (ii) the production costs. Dumping is used to undercut domestic manufacturers to gain market share and is prohibited by U.S. trade laws and World Trade Organization rules. The Petitioner claims that as solar component manufacturing in the Subject Countries continues to rapidly expand, the prices of solar components manufactured in the Subject Countries will continue to fall, resulting in significant injury to U.S. solar manufactures already struggling to compete with cheaper, foreign-produced components. As evidence of the Subject Countries’ growing market share, the Petitioner cites S&P’s recent report that solar imports to the U.S. from the Subject Countries increased from 78% to 84% between Q3 and Q4 of 2023.
In March 2022, following a two-year moratorium on solar cell and module tariffs imported from the Subject Countries, the DOC began an investigation into whether solar cells and modules imported from Southeast Asia (including the Subject Countries), were used to avoid U.S. duties on solar modules manufactured in China. On August 18, 2023, the DOC concluded that solar cells and modules assembled in the Subject Countries, but comprised of components manufactured in China and subsequently exported to the United States, were circumventing U.S. trade laws. The DOC’s final determination, and identification of specific Subject Country manufacturers, was identical to the DOC’s preliminary findings.
Current Antidumping and Countervailing Duty Enforcement
In reaction to the 2023 findings, the DOC promulgated regulations to strengthen antidumping/countervailing duty enforcement and to address China’s influence on third-country markets (including the Subject Countries). Accordingly, the DOC imposes enhanced duties on products when: (i) there is a reasonable basis to believe or suspect that the product is being sold, or is likely to be sold, at less than its fair market value and (ii) the ITC determines that there is reasonable indication that the domestic solar cell and module industry is (a) materially injured or (b) potentially injured because of such product imports.
Generally, the DOC determines if products were dumped and if governments of the Subject Countries subsidized exports to the U.S.; while the ITC determines if importing subject products materially injures, or threatens material injury to, the domestic market. If the DOC and ITC make such determinations, the DOC may impose enhanced duties, including retroactive duties in certain “critical circumstances.” Although the Petitioner does not identify specific subsidy rates from the Subject Countries, the Petition alleges that solar cells and modules are imported and dumped in the U.S. market at the following margins:
| Cambodia | 127.06% |
| Malaysia | 81.24% |
| Thailand | 70.35% |
| Vietnam | 271.45% |
Proposed Scope of Investigation
The DOC and ITC preliminary investigations will cover (i) CSPV cells and (ii) modules, laminates and panels consisting of CSPV cells (even if such cells are not partially or fully assembled into other products). Specifically, the DOC and ITC preliminary investigation will focus on CSPV cells 20 micrometers thick or greater and that have a P-N junction formed by any means (including, but not limited to, cleaning, etching, coating or addition of materials for collecting and forwarding generated electricity to the cells). Several products are excluded from the investigatory scope, including cells produced from different materials, cells that do not exceed proposed surface areas and some off-grid portable panels.
Timeline
The antidumping and countervailing duty preliminary investigations will follow the following timeline. See the International Trade Administration’s statutory time chart for more information:
| Date1 | Milestone | Explanation |
|---|---|---|
| July 24, 2024 | Petition date | |
| May 14, 2024 (Petition date + 20 days) | DOC initiation date of AD and CVD investigation | DOC determines if the AD and CVD petition contains information legally sufficient to initiate an investigation. |
| June 8, 2024 (Petition date + 45 days) | ITC preliminary determination date of AD and CVD petition | |
| July 18, 2024 (DOC initiation date + 65 days) | DOC preliminary determination date of CVD petition | CVD duties may be collected as soon as preliminary determination is published in Federal Register.2 |
| October 1, 2024 (DOC initiation date + 140 days) | DOC preliminary determination date of AD petition | AD duties may be collected as soon as preliminary determination is published in Federal Register.2 |
| October 1, 2024 (DOC preliminary determination date + 75 days) | DOC final determination date of CVD petition | |
| November 15, 2024 (DOC final determination + 45 days) | ITC final determination date of CVD petition | |
| November 22, 2024 (ITC final determination + 7 days) | DOC order issued for CVD petition | |
| December 15, 2024 (DOC initiation date + 215 days) | DOC final determination date of AD petition | |
| January 29, 2025 (DOC final determination + 45 days) | ITC final determination date of AD petition | |
| February 5, 2025 (ITC final determination + 7 days) | DOC order issued for AD petition |
1 All determination dates may be extended; and if, after the preliminary determination, the DOC or ITC determination is negative, the investigation will terminate.
2 If Petitioner alleges “critical circumstances,” duties may be collected 90 days prior to the publication in the Federal Register.
McGuireWoods is continuing to track the Petition, the DOC and ITC investigation, and the market response. Please reach out to the authors with any questions or to further discuss any of the above information.