Department of Commerce Opens Investigations Into Circumvention of Chinese Solar Cells Through Cambodia, Malaysia, Thailand, and Vietnam

On March 28, the Department of Commerce announced that it is initiating investigations to determine whether solar cells and modules assembled in Cambodia, Malaysia, Thailand, or Vietnam are circumventing the antidumping (AD) and countervailing duty (CVD) orders on Crystalline Silicon Photovoltaic Cells (CSPV), Whether or Not Assembled into Modules, from the People’s Republic of China. The products covered are included in the scope section of the Commerce initiation memorandum.

Auxin Solar Inc. (Auxin), the U.S. company that filed the request with Commerce, alleged that Chinese-origin parts and components are assembled or completed in the four covered Asian countries prior to being imported into the United States, thereby circumventing and evading the applicable AD and CVD duties.

Key takeaways:

Although Commerce has initiated the anti-circumvention investigations, it is not at this time ordering Customs and Border Protection (CBP) to suspend liquidation of import entries from the four countries. Commerce will only instruct CBP to suspend liquidation if it makes an affirmative preliminary or final determination of circumvention.

This means that importers will not be required to post AD/CVD duties on imports from the four countries until Commerce issues an affirmative determination. The preliminary determination is expected no later than 150 days from publication of the initiation notice in the Federal Register.

If its preliminary determination is affirmative, Commerce will instruct CBP to suspend liquidation of entries made on or after the date of initiation that remain unliquidated at the time of publication of that determination in the Federal Register.

Commerce soon will send questionnaires to companies in Cambodia, Malaysia, Thailand, and Vietnam concerning their shipments of solar cells and modules to the United States and the origin of inputs that they used to produce the solar cells and modules. A company’s failure to respond increases the risk of an adverse finding regarding imports from that company and affirmative determination of circumvention.

If you have any questions regarding the content of this alert, please contact Mark Ludwikowski (mludwikowski@clarkhill.com; 202-640-6680); William Sjoberg (wsjoberg@clarkhill.com; 202-772-0924); or, another member of Clark Hill’s International Trade Business Unit.