TOP NEWS: EC imposes 11.8% anti-dumping duties on Chinese PV imports

The European Commission will impose AD duties of 11% on Chinese PV imports.Flickr/Remko Tanis

The European Commission imposed punitive anti-dumping duties on Chinese PV imports to Europe on Tuesday despite broad industry-wide opposition. The industry expresses its views to pv magazine.

The European Commission has approved a phased introduction of punitive anti-dumping tariffs on Chinese PV imports to Europe despite growing threats of an impending trade war and loud opposition by a majority of EU member states and much of the European PV industry.

The EC has imposed initial duties of 11.8% on all Chinese solar products in what has become the biggest anti-dumping case ever undertaken by the Commission -- Chinese PV panel imports to the EU totaled $27 billion (€21 billion) in 2011.

The provisional tariffs, which will be in effect between June 6 and Aug. 6, will affect Chinese-made solar panels, cells and wafers. The duty will be set 11.8% until Aug. 6, after which they will increase to 47.6%, which the Commission said was "the level required to remove the harm caused by the dumping to the European industry."

The Commission reiterated its readiness to pursue discussions with Chinese exporters and with the Chinese Chamber of Commerce in order to find a solution in line with European trade regulations.

Speaking at a press conference in Brussels on Tuesday, European trade commissioner Karel de Gucht said, "This is not protectionism," adding that the EC was simply applying international trade rules – "the same trade rules that we have to abide by."

De Gucht stressed that the tariffs were "a clear incentive to negotiate. The ball is now in China’s court."

China has until Aug. 6 to provide a solution, de Gucht added. "It’s a window of opportunity for 60 days. After 60 days the window will shut."

Chinese companies that cooperate would face lower tariffs while companies that did not would face higher tariffs, de Gucht said.

The duties will continually increase after two months and could reach as high as 47.6% -- the amount initially threatened by the EC and a level that would effectively lock Chinese players out of the EU market.

While the move would help European solar panel manufacturers, much of the industry fears it could also hurt overall business in Europe, including installers and polysilicon producers that sell to Chinese panel makers.

The Alliance for Affordable Solar Energy (AFASE) has warned that anti-dumping duties would have a detrimental effect on Europe’s solar industry and cost up to 250,000 jobs throughout the EU.

The AFASE blasted the EC decision, saying the Commission "ignored the position of the vast majority of EU member states."

"The Commission’s decision gives the EU and China very little time to come to a negotiated solution. We therefore call on both sides to find common ground, avoid the price increases and to consider the interests of the entire solar industry in Europe," said Thorsten Preugschas, CEO of Germany’s Soventix GmbH and AFASE chairman, adding that in view of the current market situation, the industry could not absorb prices increases. He warned that 11% tariffs would stop the development of new PV projects in the EU and cause serious harm to the entire value chain.

German Chancellor Angela Merkel has also come out against duties and called for negotiations to settle the issue.

"Protectionism is fundamentally negative for our business and also doesn’t help the remaining European PV industry," Ralf Lüdemann, CTO of German-based equipment manufacturer Schmid, told pv magazine. "But if there is a political decision for duties, then it’s better that they are moderate and with the option for further negotiations than to set them so high that they completely block the Chinese from the European market. What would be necessary to really support the European PV industry is a positive political signal and an appropriate positive political framework for the PV industry rather than punitive duty measures."

Paul Barwell, CEO of the U.K.'s Solar Trade Association (STA), which has opposed duties, said in a statement: "These reports are encouraging. We are pleased that Karel de Gucht has listened to the concerns of the European solar industry and the majority of member states. However, the devil is very much in the detail, and we must keep up the pressure.

"Any form of duties is not good news," Barwell added. "Allowing the industry a two month reprieve at 11% duties, without catches, might allow the industry some breathing space. However, European delivery lead times are up to ten weeks, and will also be subject to the availability of stock.”

Speaking to pv magazine, IHS analyst Henning Wicht said he sees an imbalance between Chinese and European market and financing conditions but adds that he does not see duties as a smart way to solve the problem because they result in counter measures and also sees negotiations as necessary for Europe and China to find long-lasting solutions and to even out the playing field.

Wicht describes the EC’s duties "as a stop-and-go measure that does not provide the necessary stability for the industry and does not help the market."