Solar trade dispute: US agrees consultation with Korea, EU, China, Malaysia and Thailand

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The U.S. has responded to a request from the EU, China, Malaysia and Thailand to enter into joint consultations on the import tariffs for PV products.

At the end of January, U.S. President Donald Trump set tariffs of 30% for imports of PV products to the U.S. under Section 201. Monday’s WTO release shows that the U.S. has now accepted the request submitted to the Dispute Settlement Body (DSB) by the EU, China, Malaysia and Thailand, to join the consultations already underway with Korea.

Thailand also submitted its own request to the WTO last Thursday, regarding the willingness of the U.S. to consult with those countries on the protectionist measures for the domestic solar industry, which are strongly affected as exporters.

In the letter, the Thai delegation stressed that U.S. action was not in line with the GATT 1994 and Safeguards Agreement. One point is that, according to these rules, as an “exporter with a substantial interest”, Thailand should have had an adequate opportunity for consultation before the import tariffs were issued.

At the end of January, U.S. Trade Representative Robert Lighthizer announced Trump’s decision to introduce duties in the Section 201 petition. According to this, tariffs should be applied to the import of solar cells and modules into the country over the next five years.

These start at 30% and will be progressively lowered to 15%. Solar cell imports totaling 2.5 GW per year are exempt from customs duties.

As part of the announcement, the U.S. said it was ready to discuss long-term solutions with interested parties. Subsequently, several countries filed complaints with the WTO, seeking an amicable solution to the safeguard duties, including the EU.

Section 301

Most recently, a new round of IT-related tariffs could make it even more expensive for any manufacturers planning to import cells from China for module production in the U.S.

On June 15, the U.S. Trade Representative included a list of another 284 product lines to the 818 it has approved for duties under Section 301 of the Trade Act of 1974. The new products include solar cell and module imports under 8541.40.60. This means that these cells and modules are among the products that will go to review, and if approved will be subject to 25% tariffs.