Commerce Finalizes Southeast Asian Solar Duties With Minor Changes, Clarifications

Antidumping and countervailing duties on solar cells and modules from Cambodia, Malaysia, Thailand and Vietnam are now set to take effect in June 2024, after the Commerce Department continued to find in final determinations announced Aug. 18 that imports from the four Southeast Asian countries are circumventing AD/CVD on solar cells from China (A-570-979/C-570-980).

The agency made few changes from preliminary circumvention determinations issued in December (see 2212020064), finding Cambodia’s New East Solar, which had preliminarily been declared exempt, circumvented AD/CVD, and also excluding it from the certification process for duty exemptions. Commerce also excluded Vietnam’s Vina from the certification process, but said Vietnam Sunergy Joint Stock Company (VSUN) is now eligible for certification.

Commerce also clarified that solar cells and modules made from Chinese wafers that were in turn made from third-country polysilicon are covered by AD/CVD under the circumvention finding. However, it said third-country wafers made from Chinese polysilicon are not subject to the circumvention finding.

Duties are on pause until June 6, 2024, per a presidential proclamation issued in 2022 that set a two-year waiver from duties to give the domestic solar industry time to ramp up production (see 2209160065), though the certification is only available if the solar cells are “utilized” by 180 days after the “termination date” for the grace period (i.e., currently Dec. 3, 2024). Certifications must also be filed to take advantage of the grace period, though even companies otherwise found ineligible for the certification process can certify for the grace period.

To meet the utilization requirement, the Southeast Asian solar cells must be “used or installed” by the deadline. In its final determinations, Commerce clarified that “'Used’ means the solar cells or solar modules are in operation or functioning in the United States by the Utilization Expiration Date,” and that “‘Installed’ means the solar cells or solar modules have been affixed to the structure or in the system in the United States on which, or in which, they will operate by the Utilization Expiration Date, but they are not in operation by that date.”

“The mere sale of solar modules to a party for a specific project, incorporating solar cells into a solar module in the United States, dedicating solar cells or solar modules to a particular project, or delivering solar cells or solar modules to a project site do not constitute being ‘used’ or ‘installed,’” Commerce said. While the solar cells may be resold and still qualify, the importer must maintain documentation that the solar cells were used or installed by the utilization date to qualify for the grace period, the agency said.

Auxin Solar, which requested the anti-circumvention inquiries, applauded Commerce’s decision in a statement emailed Aug. 18, though it called for an early end to the duty waiver.

“For years the Chinese have flouted the U.S. trade remedy laws and today, with Commerce’s affirmative country-wide circumvention decisions on Cambodia, Malaysia, Thailand, and Vietnam, we’ve successfully closed these loopholes,” Auxin CEO Mamun Rashid said. “Because ample solar module supply exists from domestic manufacturers and non-circumventing imports, President Biden should immediately end his unlawful tariff moratorium policy and not continue to give Chinese trade cheats a continued free pass to the U.S. market.”

The Solar Energy Industries Association, on the other hand, said domestic manufacturers need more time as it bemoaned the final finding of circumvention.

“Auxin Solar’s allegations of circumvention were meritless from the beginning and the inquiries have caused uncertainty in the U.S. market at a time when solar energy is on the rise,” said Abigail Ross Hopper, SEIA president and CEO. “The final affirmative determinations only perpetuate current supply problems, given the lack of adequate domestic supply of cells and modules.”

“The United States is experiencing a $20 billion solar manufacturing renaissance because of policies in the Inflation Reduction Act that incentivize private investment in this country. However, it will take at least 3-5 years to ramp-up domestic solar manufacturing capacity and the global supply chain will be vital in the short-term. This case will just make it harder for American businesses to keep deploying, financing, and installing solar power,” Ross Hopper said.

As announced in the preliminary determinations, Commerce is allowing for three types of certifications for exemptions from AD/CVD for solar cells from Cambodia, Malaysia, Thailand and Vietnam that were produced with Chinese inputs. One qualifies goods for the grace period. Another two will persist beyond the grace period’s expiration: that the goods are exempt because their entries are from an exempt exporter, or that they are exempt because they aren’t made from Chinese wafers or have only minor Chinese content.

See Appendix II in Commerce’s final determination notice for a list of the 23 companies that are ineligible for certification, except for that required for the two-year grace period.