Bankrupt U.S. Solar Firm Turns Up Heat on Chinese Imports

(Beijing) — Bankrupt solar panel maker Suniva Inc. has complained to the U.S. International Trade Commission (ITC) about allegedly unfair competition from imports, raising the prospect of new anti-dumping tariffs against products from China and other countries.

Under existing rules, the ITC will complete the “injury phase” of its investigation within 120 days of receiving the complaint, according to a Wednesday announcement on its website that disclosed its receiving Suniva’s complaint.

“The commission may recommend to the president an increase in a duty, imposition of a quota, imposition of a tariff-rate quota, trade adjustment assistance, or any combination of such actions,” the ITC said in the statement.

Suniva lodged the complaint after filing for Chapter 11 bankruptcy protection last week, becoming the latest victim of protracted oversupply in the global solar panel sector.

Under the U.S. Bankruptcy Code, Chapter 11 protection frees a company from the threat of creditors’ lawsuits while it reorganizes its finances, but a majority of the company’s creditors must then accept the company’s reorganization plan.

Many blame the solar-panel oversupply on a big buildup in China, whose industry now supplies more than half the world’s products.

Many manufacturers outside China say the global industry’s glut is due in no small part to preferential policies from Beijing and local Chinese governments, which often provide support to producers in the form of policies like low-interest loans and cheap land for manufacturing.

“The case of Suniva dramatically demonstrates that the U.S. solar manufacturing industry still suffers from unfair trade,” said SolarWorld, one of the most vocal critics of China’s industry. “In particular, highly subsidized Chinese companies as well as other producers are globally dumping their products, forcing competitors to take losses, lay off workers and exit the market.”

Following previous complaints, both the U.S. and EU imposed punitive sanctions on Chinese solar panels. As a result of such penalties, China’s solar panel exports dropped 10% last year, their first decline since 2013.

That punitive actions prompted many Chinese producers to set up factories outside the country to make panels that were exempt from the tariffs. But a potential new anti-dumping ruling in the Suniva case could also affect those panels.

Despite the possibility of new punitive tariffs, one insider close to the Chinese industry said the threat may be less now than it was when the U.S. imposed its original penalties five years ago. That’s because many weaker players have already closed, and the solar power lobby, which likes low panel prices created by stiff competition, has gained strength over that period, he said.

“The argument is shifting. Most politicians have accepted that solar manufacturing jobs are not coming back to Europe and the U.S.,” he said. “Cheap Chinese panels help lower energy costs, meet carbon goals and generate hundreds of thousands of downstream jobs.”

Contact reporter Yang Ge (geyang@caixin.com)