Update: For a report on today’s ruling by the Commerce Department, see our story here.
The U.S. Commerce Department will announce a final decision today on duties in the China solar trade dispute that has split the U.S. industry and raised fears of a global trade war. Of course, for several months the government has already been collecting duties on certain Chinese solar imports. And, just to be clear, this won’t be the last word in the case.
Confused? Let’s try to sort things out.
First, Commerce will make a final determination today on the level of duties on crystalline silicon solar PV products from China.
You’ll recall that earlier this year, in two separate rulings, the department ordered preliminary antisubsidy duties ranging from 2.9 to 4.73 percent on imports from China and antidumping duties of around 31 percent on China’s largest solar companies, including Trina and Suntech, and up to nearly 250 percent on other manufacturers. Later, it boosted the antisubsidy duties to 3.44 percent on Wuxi Suntech and 5.81 percent on Trina.
Today, Commerce will nail down those levels. SolarWorld and its Coalition for American Solar Manufacturing cohorts, who started us down this long and winding road nearly a year ago, contend the duties should be heftier in order to fully offset the Chinese industry’s allegedly unfair advantages.
The aggrieved U.S. manufacturers and their supporters in Washington are also urging Commerce, in its decision due today, to expand the products subject to duties.
The argument here is that the Chinese companies are doing all the steps of the solar PV process in China except the manufacturing of the cells – adding “80 percent of the value of the final product” in China, according to a letter from several members of Congress to the Commerce Department [PDF] – and even shipping the product from China, and yet aren’t required to pay duties.
So all of this will be sorted out with the Commerce Department decision today.
But as we said, that won’t be the end of the case.
While the Commerce Department is responsible for determining the level of duties, it’s up to a second government entity, the U.S. International Trade Commission, to decide whether to enforce such duties, based on whether the U.S. crystalline silicon PV manufacturing sector as a whole is being injured by the Chinese practices.
In a preliminary ruling in December 2011, the ITC voted 6-0 that there was enough evidence to send the case forward. The commission is scheduled to decide on Nov. 7 whether to finalize the duties set by the Commerce Department, and whether to impose them retroactively, as has been the case on the preliminary duties. All it will take for the ITC to lock the duties in place will be a 3-3 vote – in this case, tie goes to the duties.
And that will finally wrap this thing up.