Canadian Solar, ET Solar, and Renesola may all be eliminated from the minimum price agreement between China and the EU after having allegedly flouted rules of the 2013 deal. According to documentation, the European Commission is proposing the withdrawal of the undertaking to the three Chinese manufacturers, potentially exposing them to the much higher anti-dumping and countervailing tariffs set in 2013.

The minimum import price (MIP) of €0.56/W was set in the summer of 2013 following a lengthy investigation by the European Commission into dumping and subsidy practices by Chinese companies. Companies were offered the chance of accepting the MIP and an import quota, or a 47.6% import tariff. Since the MIP was instituted, there have been widespread rumours circulating within the European industry of Chinese companies employing various tactics to avoid the MIP, but none have so far stuck.

But an official internal document from the MIP monitoring team in the commission’s Directorate General for Trade outlined proposals to withdraw the MIP from Canadian Solar, ET Solar, and Renesola. On March 5th 2015, the document gives a detailed account of the three companies’ alleged transgressions, which range from breaches in reporting obligations under the deal to exceeding the limit on sales set within the undertaking. The main findings are outlined below:

Canadian Solar

According to the commission, Canadian Solar “provided certain benefits to several customers”, which it did not detail in quarterly reports submitted to the commission, prompting the commission to conclude the company had “breached” its reporting obligation under the undertaking. The commission said further analysis of the benefits led it to conclude Canadian Solar had breached its obligation with respect to the MIP, as “deducting these benefits from the sales price in the transactions with the customers concerned decreased these prices below the MIP”. Canadian Solar also conducted “parallel sales” of modules covered and not covered by the MIP to the same customers, prompting the commission to conclude the firm had breached limits set by the undertaking.

ReneSola

Although ReneSola operates an original equipment manufacturer network around the world, which allows it to circumvent trade duties such as those in force in Europe and the US, the commission said this arrangement had made it impossible to monitor the provenance of ReneSola’s imports into Europe. “The commission analysed the implications of the this pattern of trade and concluded that it renders the monitoring of ReneSola’s undertaking impracticable,” the document said.

ET Solar

ET Solar has apparently fallen foul of the fact that it sells complete solar parks and has not specified sales of its modules within these deals in its reports to the commission. “ET Solar is not able to demonstrate the MIP is respected in the sales of complete solar parks as there is no sales price per se for the modules as the customer pays only a total price for the installation and no further reliable breakdown of the price for the modules, other equipment and services was provided…This renders the monitoring of ET Solar’s undertaking impracticable.”

“Due to the depreciation of the Euro, recent market prices reflect a downtrend,” said Angus Kao, research manager of EnergyTrend. “Plus, Chinese manufacturers only ship a small amount of products to Europe, thus Chinese manufacturers’ reactions to this are not significant,” he added.
 

Source: Chinese PV firms face exclusion from EU price deal
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