Canadian Solar, ReneSola and ET Solar have been officially removed from the Minimum Import Price (MIP) agreement signed between the EU and China. The withdrawal means that the three companies will be imposed on an approximately 47.6% of anti-dumping tariffs when export their products into the EU. ReneSola and ET Solar have accepted the judgment, while Canadian Solar announced to review its legal options.
In March, 2015, rumors had it that 22 Chinese solar companies were under investigation for customs offences by the European Anti-Fraud Office (OLAF), and Canadian Solar, ReneSola and ET Solar were accused to violate the MIP agreement, a undertaking signed in 2013 to limit Chinese companies sell PV products (PV cells and PV modules) above a minimum import prices and to keep sales within an annual quota. Manufacturers which are not listed in the agreement have to pay a 47.6% tariffs when export PV products into the EU.
On June 5, the three companies were officially removed from the MIP agreement because of confirmed illegal moves. According to PV Tech, RenaSola was cited because its OEM model was deemed too difficult to administer. Canadian Solar was reported to be offering unreported, parallel sales alongside its modules to effectively reduce the price – meaning that Canadian Solar was alleged to ship PV products through third-party countries. ET Solar was found to be selling modules by integrating them into solar projects without reporting them.
Responses of the Firms
After being removed from the MIP deal, Canadian Solar announced that the company is currently reviewing its legal options to defend itself against being imposing the 47.6% tariffs.
“Despite the arbitrary nature of the Undertaking text that caused interpretation confusion and implementation complications, Canadian Solar believes that it has always conducted all its business in the EU in compliance with the Undertaking,” noted in Canadian Solar’s statement, yet the decision will not impact the company’s guidance for the second quarter and the full year 2015. Canadian Solar regards the decision as an arbitrary ruling that lacks of merit, so it will take legal actions over the decision.
On the contrary, ReneSola and ET Solar will retreat from the MIP deal. Both companies will no longer export PV products from mainland China.
ReneSola, which announced to quit the MIP agreement in March, will shift the orders from the Europe to manufacturers located in other regions/countries such as Poland, Turkey, South Africa and South Korea. ReneSola is unlikely to abandon the European market. The company shipped 36.9% of PV modules to Europe in 2014. Nonetheless, the company is believed to allocate more PV shipment in markets except Europe.
ET Solar tried to convince relevant authorities of the EU of not violating the MIP agreement. However, the up-and-downstream integrated business model remains unacceptable to the European Commission. As a result, ET Solar decided to stop exporting PV products from China to Europe.
“After years of global deployment, we have international PV module production lines. We will ship out products from countries other than China,” said a representative of ET Solar to a Chinese media. “As MIP is somehow complicated to some of our clients, shipping products from other countries might help us to ensure our clients’ rights. MIP usually brings up uncertain issues.”
In 2014, ET Solar shipped 30~40MW of PV products as part of its EPC services, while the total PV module shipment to the region was approximately 120MW, representing 15% of the company’s total PV module shipment. Shipment to the U.K. shared 70% of the total volume to Europe.
The EU’s moves
The EU has been endeavoring to fill the loopholes of the 2013-signed MIP agreement since the beginning of 2015. The EU has announced to launch anti-circumvention investigation against imports from Taiwan and Malaysia, countries that are alleged to help Chinese PV manufacturers circumvent the MIP deal. Furthermore, three Chinese companies that were cited to violate the deal are now removed from the agreement.
It is likely that the EU will review the MIP agreement and set a new one.
(Photo: Canadian Solar's project in France.)