MOC blasts US tariff decision

Solar panel producers may take legal action

China's Ministry of Commerce (MOC) on Wednesday blasted the US commerce authorities' decision to impose another round of tariffs on Chinese photovoltaic (PV) imports, describing it as unfair and damaging for Chinese companies.

In a final decision on its January probe into Chinese PV products, the US Department of Commerce said Tuesday that it will impose anti-dumping duties on imports of crystalline silicon PV products from the Chinese mainland and Taiwan, ranging from 26.71 percent to 165.04 percent, and 11.45 percent to 27.55 percent, respectively.

The US also decided to impose anti-subsidy duties ranging from 27.64 percent to 49.79 percent on crystalline silicon PV products from the Chinese mainland.

This is the second time tariffs have been arbitrarily imposed on Chinese PV products, and the US is abusing its WTO obligations, according to a statement posted on the MOC website Wednesday.

In 2012, the Chinese mainland's solar power industry was hit by steep duties levied by the US.

The US decision will further inflame trade tensions between the two countries relating to solar products, and has caused discontent among Chinese companies, said the MOC statement.

The US currently imports PV products from the Chinese mainland worth around $3 billion each year, so the punitive duties will have a big effect, Meng Xian'gan, deputy director of the China Renewable Energy Society, told the Global Times Wednesday.

Trina Solar Ltd, one of the mainland companies that will be affected by the new tariffs, failed to comment on the issue when contacted by the Global Times Wednesday, but said it would issue a statement about it on Thursday.

The China Chamber of Commerce for Import and Export of Machinery and Electronic Products said in a statement on Wednesday that China's solar companies will continue to protect their interests, possibly including legal action.

Punitive tariffs have become a recurring problem for domestic solar companies, which were also confronted with anti-dumping and anti-subsidy probes by the EU in 2012.

Canada also announced on December 5 that it had initiated similar probes.

Analysts said China will probably see more probes by foreign countries against PV imports in the future.

"Because China's labor costs are not as high as those in the West, its PV products are cheaper, giving room for suspicion on the issue of dumping and subsidies," Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times Wednesday.

Lin said this means companies have two major options - either moving their production abroad to avoid punitive tariffs, or trying to get more government subsidies to help fast-track the commercial application of high-cost solar energy domestically.

NYSE-listed ReneSola Ltd announced on December 2 that it had opened new offices and warehouse facilities in Mexico and Canada.

Meng agreed that building plants overseas or outsourcing could be an effective strategy for avoiding tariff penalties, but he warned that it could also increase labor and tax costs.

This could lead to a greater burden for solar firms, which have been suffering losses as a result of overcapacity following the rapid expansion of the sector since 2011, he said.

NYSE-listed Yingli Green Energy Holding Co, a solar panel maker based in Baoding, North China's Hebei Province, recorded a net loss of 122.8 million ($20 million) in the third quarter of 2014, according to its quarterly financial report released in November.

By the end of 2013, China's on-grid installed solar power generating capacity reached 19.42 gigawatts, with 12.92 gigawatts being added in 2013 alone, according to data released in April by the National Energy Administration.