Clean Energy e-briefing: Light at the end of the tunnel? Update on European Union solar panel anti-dumping row

• United Kingdom

• Energy and infrastructure - Clean energy

25-06-2013

China and the European Union (EU) appear to be making significant progress towards a negotiated settlement in the EU's ongoing solar panel anti-dumping investigation. EU Trade Commissioner, Karel De Gucht, and Chinese Minister of Commerce, Gao Hucheng, met in Beijing on Friday 21 June 2013 for the 27th EU-China Joint Committee.

Although the European Commission’s (EC) solar panel investigations were not part of the Joint Committee’s agenda, Commissioner De Gucht nevertheless confirmed that confidential technical-level discussions had begun with a team of Chinese experts in Brussels in a bid to find a negotiated settlement and confirmed that he and Minister Gao would discuss the issue. Commissioner De Gucht stressed that discussions had only just begun and were still at a very early stage in the negotiation process.

According to recent press reports, the most likely structure to a settlement would be around a price undertaking under where Chinese importers would not sell solar panels below an agreed minimum price, possibly combined with a quota capping the volume of imports from China.

Important issues to watch will be:

• How will any quota be split up between Chinese manufacturers – straight market share or first come first serve?
• How will ‘Chinese’ be defined for the quota and/or price undertaking? Will panels manufactured in other locations qualify especially if their manufacture has been relocated as a result of the anti-dumping duties?
• Exactly how would the pricing undertaking operate and at what price?

A final settlement may be a little way off. It will require the buy in of Chinese importers, and no doubt the terms of any settlement will be hotly contested.

However, the clock is ticking. The EU imposed provisional anti-dumping duties averaging 11.8% with effect from 6 June. These jump to a crippling 37.2% to 67.9% (averaging 47.6%) from 6 August. The EU is also due to reach a provisional decision in its related anti-subsidy investigation in early August.

For more background on the investigation, please see our previous briefings on putting solar power in the shade and solar panel anti-dumping (update).