Exclusion from Solar Panel Safeguard to be Withdrawn Again
The Office of the U.S. Trade Representative has determined to again withdraw the exclusion of bifacial solar panels from a safeguard on solar products. This withdrawal will apply to imported panels if the Court of International Trade lifts its preliminary injunction against such action but in no case earlier than May 18.
The Section 201 safeguard on crystalline silicon photovoltaic cells and other CSPV products containing these cells consists of (1) a tariff-rate quota on CSPV cells not partially or fully assembled into other products, with an unchanged duty rate for the in-quota quantity and a higher duty rate for over-quota articles, and (2) a higher duty rate on other CSPV products. In June 2019 USTR excluded from this safeguard bifacial solar panels that absorb light and generate electricity on each side of the panel and that consist of only bifacial solar cells that absorb light and generate electricity on each side of the cells.
This exclusion was withdrawn in October 2019 after USTR received information demonstrating that global production of bifacial solar panels is increasing, that the exclusion would likely result in significant increases in imports of these goods, and that such imports likely would compete with domestically produced monofacial and bifacial CSPV products in the U.S. market. However, the Court of International Trade subsequently found that USTR had not completed the proper procedures for withdrawing the exclusion and issued a preliminary injunction against it.
USTR now states that after considering public comments and an International Trade Commission report and consulting with the departments of Commerce and Energy, it has again determined that this exclusion is undermining the objectives of the safeguard and does not meet the criteria for a legitimate exclusion. Among other things, USTR determined that since bifacial solar panel production is currently low in the U.S. and the vast majority of production capacity is foreign, allowing imports of such panels free of safeguard tariffs would disincentivize U.S. producers from converting existing monofacial production to bifacial production or opening new bifacial production. In addition, low-priced imports of bifacial solar panels due to the exclusion are likely to prevent domestic producers from selling significant quantities of solar panels in the utility segment under current market conditions.
USTR therefore plans to ask the CIT to lift its preliminary injunction and to withdraw the exclusion if and when that takes place.
For more information, please contact trade attorney Kristen Smith at (202) 730-4965.