The European Union was preparing to scrap import controls on Chinese solar panels and cells in September when the current protective measures expire, Reuters reported on August 24.
The European Commission, which is responsible for EU trade policy, rejected a request from EU producers to further extend the measures, and got support by a majority of the EU’s 28 member states, according to EU sources close to the matter.
Both the EU and the United States have placed punitive tariffs on solar panel imports from China for years, after launching a probe that judged Chinese manufacturers received unfair subsidies from the government.
The European Union first imposed anti-dumping duties on Chinese solar panels in 2013 and extended them in March 2017 by 18 months, meaning they should end next month.
While the U.S. has levied heavier anti-dumping tariffs on Chinese manufacturers, the EU has worked out a system that allows China’s exporters to undertake no duties if they agree to sell solar products at prices set by the EU. Otherwise, they are subject to duties of up to 64.9 percent.
The system is aimed at achieving a delicate balance between the interests of EU solar manufacturers and those such as importers and installers who are seeking hard to reduce the cost of solar power generation.
The EU is set to end the import control when the current anti-dumping measures expire next month, which enables Chinese manufacturers to restart selling solar panels at their own prices, reports said.
That news, since being released, had contributed to the share rally of panel and component makers listed in Hong Kong and mainland China stock markets.
Executives at major panel manufacturers also believed that the EU measures would not be prolonged after their expiry next month, and an official announcement of the decision is expected to be made around Sept. 3, said UBS analyst Alex Liu. The current pricing system has forced Chinese manufacturers to sell their solar products in Europe at prices about 30% above their quotes on the spot market, he added.
“This could be very positive for Chinese solar manufacturers,” Liu said. “It can help Chinese solar manufacturers to increase their shipments to the European market. They will be able to sell their products in Europe at very low prices because there is no restriction.”
Europe accounted for 6% to 7% of global demand for solar panels last year, and the share could climb to as high as 10% this year.