Request for Circumvention Inquiry Filed against Solar Cells and Panels from Southeast Asia

On February 8, 2022, Auxin Solar Inc. (“Auxin”) filed a request that the U.S. Department of Commerce (“the Department”) determine whether the antidumping duty and countervailing duty (“AD/CVD”) orders on crystalline silicon photovoltaic (“CSPV”) cells and modules, i.e., solar cells and panels, from China are being circumvented.  Auxin alleges that certain Chinese CSPV producers are circumventing these AD/CVD orders by performing most of the manufacturing for CSPV cells and modules in China, and then completing them in Southeast Asia.  These allegations are similar to those in a petition that was filed in September 2021 by a coalition called the American Solar Manufacturers Against Chinese Circumvention (“A-SMACC”).  The Department ultimately rejected A-SMACC’s request because the coalition refused to disclose the names of its members publicly. Although Auxin’s request is similar to the prior petition in many respects, there are a couple key differences.  Auxin has alleged that circumvention is occurring in Cambodia, Malaysia, Vietnam, and Thailand; the prior request did not include Cambodia.  More importantly, A-SMACC only asked for anticircumvention inquiries into certain companies, whereas Auxin is requesting that the Department conduct a country-wide circumvention inquiry into each of the four subject countries.  If the Department agrees, this may mean that all imports of CPSV cells and modules from these four countries will be presumed to be subject to the China CSPV AD/CVD orders. Normally, when the Department imposes such a presumption, it will also design a certification process that will allow U.S. importers to demonstrate that merchandise coming into the U.S. is not circumventing the order, and thus not subject to AD/CVD duties. The Department will have until March 10, 2022 to decide whether or not to initiate a circumvention inquiry.  It can extend this deadline by 15 days if necessary.  If an inquiry is initiated, under new regulations that were issued last year, the Department must issue its final determination within a year from the date of initiation.