Brussels, 04/06/2013 (Agence Europe) - Despite reluctance from a large majority of member states, the European Commission has decided to impose provisional anti-dumping duties on Chinese solar panels.
Defying the opposition of the member states and the threats of trade retaliation from Beijing, the European Commission decided, on Tuesday 4 June, to impose provisional anti-dumping duties on imports of solar panels from China. This was a unanimous decision by all the members of the College of Commissioners, European Commissioner for Trade Karel De Gucht assured the press.
The EU will impose tariffs from 6 June for the next six months on imports of Chinese solar panels. This will be done in stages. From 6 June, a tariff of 11.8% will be imposed on all imports of these products. Two months later, on 6 August, the average tariff will be 47.6%. Overall, the duties will range from 37.2% to 67.9%. The Chinese companies which have cooperated will face lower tariffs. Those which have not cooperated will face higher tariffs, De Gucht said. “This staggered response allows a smooth transition for our markets to adapt - and it is a one-time offer to the Chinese side, providing a very clear incentive to negotiate. It provides a clear window of opportunity for negotiations, but the ball is now in China's court. It is clear that if China does not provide a solution by August, then the higher tariffs will apply”, De Gucht warns.
Alerted by a group of European businesses in the photovoltaic sector - businesses that were brought together under the banner of the EU Pro Sun association - the European Commission opened an investigation, in September 2012, into the dumping practices from which Chinese solar panel manufacturers were benefitting. The investigation will take until the end of December - at which date the European Union will have to decide whether to impose permanent duties on Chinese solar panels for a period of five years. As the procedure leaves it the choice, the Commission wanted to adopt “emergency measures” on a provisional basis in order to sanction China. At this stage, the opinion of member states is only consultative. However, led by Germany, the United Kingdom, the Netherlands, Sweden and Finland, 18 member states are reportedly opposed to this measure, and want a negotiated solution. By contrast, the sanction is supported by France, Italy and Portugal - member states that want to save a sector in dire distress.
“Our action (…) is an emergency measure to give life-saving oxygen to a business sector in Europe that is suffering badly from this dumping”, said De Gucht, stating that the investigation led by his staff had determined that Chinese solar panels were most certainly sold on the European market at a price lower than cost. “Our estimate of the fair sale price of a Chinese solar panel would actually be 88% higher than the current price for which they are sold on the European market”, De Gucht said. “The dumping of these Chinese solar panels is clearly harming the European solar panel industry. This jeopardises at least 25,000 current jobs. Furthermore, the dumping threatens the sector's very survival by damaging current and future investment - especially in the critical area of research and development”, in De Gucht's view. China, which has captured 80% of the European market share, has furthermore put the world market into overcapacity, producing 150% of total world consumption. “In other words, it's producing today one and a half times the amount of solar panels the world needs. They are simply producing too much”, De Gucht insists.
The EU's response is therefore “balanced, legal and justified within international trade rules and designed to prevent the situation turning fatal”, De Gucht continues. “This is not protectionism. Rather it is about ensuring international trade rules also apply to Chinese companies - just like they apply to us”, he said, recalling that the United States is also currently applying anti-dumping duties on Chinese solar panels. Nevertheless, De Gucht does not rule out a negotiated solution with the Chinese authorities. “Let me be very clear. My sincere aim since the outset has been an amicable solution. This is illustrated by the open-door policy I have had over the last year with our Chinese partners at their request - with numerous meetings at either my level or at the level of my services. I hope today's decision will now provide the space for such discussions to move forward in a formal manner”, De Gucht stressed. “I want an amicable solution with our Chinese partners. That is also what Europe wants”, he repeated.
However, on Tuesday, De Gucht also underlined his fight for the Commission to preserve its independence on anti-dumping decisions. He said that with the action taken against imports of Chinese solar panels that day, the Commission was assuming its role of independent defender of European industry in the face of unfair trade practices from third countries. “I needn't remind you that the 'rule of law' is the fundamental principle at the heart of the European Union (…). It is the European Commission which has the responsibility of behalf of the EU to carry out its external trade policy”, De Gucht said. He continued that they had a moderate but decisive approach and that he did not believe that European policies should be inspired by fear. Beijing - which up until the last moment tried to change the Commission's position, with the Chinese Prime Minister Li Keqiang speaking to President of the European Commission José Manuel Barroso on the telephone on Monday evening - has found a solid partner for its trial of strength. (EH/transl.fl)