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E.U. Investigates Chinese Solar Panels E.U. Investigates Chinese Solar Panels
(about 4 hours later)
CHENGDU, CHINA — The European Union began on Thursday morning its biggest anti-dumping investigation ever in terms of value, a broad inquiry into whether Chinese companies have been exporting solar power products for less than it costs to make them. CHENGDU, CHINA — The European Union began on Thursday morning the world’s biggest anti-dumping investigation in terms of value, a broad inquiry into whether Chinese companies have been exporting solar power products for less than it costs to make them.
The case covers imports from China worth $26.5 billion last year, a hefty 6.5 percent of all European imports of Chinese goods.The case covers imports from China worth $26.5 billion last year, a hefty 6.5 percent of all European imports of Chinese goods.
After exerting heavy diplomatic pressure for the European Union not to start the case, and after veiled threats to retaliate, the initial Chinese response on Thursday was restrained.After exerting heavy diplomatic pressure for the European Union not to start the case, and after veiled threats to retaliate, the initial Chinese response on Thursday was restrained.
Shen Danyang, the Commerce Ministry spokesman, said in a statement that China expressed “deep regret,” adding that the trade action would hurt not only industries in China and the European Union but also the global development of clean energy.Shen Danyang, the Commerce Ministry spokesman, said in a statement that China expressed “deep regret,” adding that the trade action would hurt not only industries in China and the European Union but also the global development of clean energy.
The scope of the European investigation is unusually broad, applying not only to fully assembled solar panels but also imports of key components like solar cells and solar wafers. If tariffs are applied, the breadth of the case would make it extremely difficult for Chinese companies from shipping the components to Europe and then assembling them into finished panels there.The scope of the European investigation is unusually broad, applying not only to fully assembled solar panels but also imports of key components like solar cells and solar wafers. If tariffs are applied, the breadth of the case would make it extremely difficult for Chinese companies from shipping the components to Europe and then assembling them into finished panels there.
The anti-dumping case, which follows bankruptcies and factory closings by European and U.S. solar panel manufacturers, considerably expands a trade battle that has already become one of the biggest sticking points in trade relations between China and the United States. The U.S. Commerce Department imposed preliminary anti-dumping tariffs in May of at least 31 percent on Chinese solar panels, in addition to preliminary anti-subsidy tariffs of 2.9 percent to 4.73 percent that were imposed in March.The anti-dumping case, which follows bankruptcies and factory closings by European and U.S. solar panel manufacturers, considerably expands a trade battle that has already become one of the biggest sticking points in trade relations between China and the United States. The U.S. Commerce Department imposed preliminary anti-dumping tariffs in May of at least 31 percent on Chinese solar panels, in addition to preliminary anti-subsidy tariffs of 2.9 percent to 4.73 percent that were imposed in March.
The Chinese government has responded by accusing American producers of polysilicon, the main material used in solar panels, of engaging in unfair trade practices and has threatened steep tariffs on the producers.The Chinese government has responded by accusing American producers of polysilicon, the main material used in solar panels, of engaging in unfair trade practices and has threatened steep tariffs on the producers.
The E.U. trade case differs from the American action in several ways. The European case is limited to anti-dumping, without including an anti-subsidy charge. By including solar wafers in addition to cells and fully assembled solar panels, the European case is also broader than the American action, which covers solar panels for which either the cell was made in China or cells were assembled into the finished panel in China. Alan Wolff, a trade official in the Johnson, Nixon, Ford and Carter administrations and one of the world’s most prominent trade lawyers ever since, said that the European Union’s anti-dumping case against solar panels from China was the world’s largest anti-dumping case ever, even adjusting for inflation.
Two other trade cases that were not anti-dumping cases might have been larger, depending on how the affected trade is measured and what inflation adjustment is used. Those are a long-running World Trade Organization case involving Airbus and Boeing jets, and a so-called “safeguards” case in the United States in 1980 against cars from Japan.
But when it comes to anti-dumping cases, in which foreign producers are accused of shipping goods at unfairly low prices, nothing matches the case that the European Union just filed against China over solar panels, said Mr. Wolff, who is now a senior lawyer in the Washington office of McKenna, Long and Aldridge.
The E.U. trade case against Chinese solar panels differs from the American solar panel case in several ways. The European case is limited to anti-dumping, without including an anti-subsidy charge. By including solar wafers in addition to cells and fully assembled solar panels, the European case is also broader than the American action, which covers solar panels for which either the cell was made in China or cells were assembled into the finished panel in China.
Making a solar panel, also known as a solar module, requires four main steps. The first is to use molten polysilicon to grow crystals or cast blocks of polycrystalline silicon. The second step is cutting and polishing the material into thin, smooth wafers.Making a solar panel, also known as a solar module, requires four main steps. The first is to use molten polysilicon to grow crystals or cast blocks of polycrystalline silicon. The second step is cutting and polishing the material into thin, smooth wafers.
The next step involves chemically treating the wafer and adding electrical contacts to turn it into a solar cell. The last step involves connecting 60 or 72 solar cells together, covering them with glass, enclosing them in an aluminum frame and adding an electrical junction box.The next step involves chemically treating the wafer and adding electrical contacts to turn it into a solar cell. The last step involves connecting 60 or 72 solar cells together, covering them with glass, enclosing them in an aluminum frame and adding an electrical junction box.