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              Congressional                                                      ____
           ~   Research Service






Circumvention Inquiry into Solar Imports



Updated May 3, 2023

On April 1, 2022, the Commerce Department initiated an inquiry into whether Chinese-manufactured
crystalline silicon photovoltaic (CSPV) cells and panels are circumventing U.S. antidumping and
countervailing duty orders. Commerce initiated the inquiry in response to U.S.-based Auxin Solar's
petition alleging that solar cells and panels imported from Cambodia, Malaysia, Thailand, and Vietnam
use Chinese-made parts and components to avoid high U.S. tariffs on solar equipment imported directly
from China. The investigation has been controversial, including among Members of Congress. Some
stakeholders assert that uncertainty about the tariffs could slow deployment of solar energy in the United
States while others insist that action is needed to protect U.S. solar manufacturing.

Background

In 2012, the Commerce Department and the U.S. International Trade Commission (ITC) determined that
imports of solar cells and panels from China were being sold below cost (dumped) or unfairly
subsidized and were injuring or threatened to injure the U.S. solar manufacturing industry. Commerce
imposed two remedial orders. The antidumping (AD) order imposed duties ranging from 18% to 25% on
goods produced by specific Chinese firms and 250% on imports from all other Chinese firms. The
countervailing duty (CVD) order, which counteracts subsidies, imposed duties of 14%-15% on all solar
products from China. In its petition, Auxin contended that certain producers in Southeast Asia have
manufacturing operations that involve minimal capital investments and technical research and rely on
Chinese inputs (e.g., solar glass, aluminum frames, and silver paste) to make CSPV cells and panels that
are then exported to the United States.

How Commerce Conducts Circumvention Inquiries

Circumvention inquiries determine whether a good imported from a country not subject to an AD or CVD
order should be included in the scope of an existing order.
Any interested party (e.g., relevant domestic and foreign manufacturers, importers, unions, and trade
associations) may submit a request for a circumvention inquiry. The Secretary of Commerce may also
self-initiate an inquiry. Once the Secretary receives a request, federal law and regulations establish
deadlines for further action:


                                                                Congressional Research Service
                                                                  https://crsreports.congress.gov
                                                                                      IN11946

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