ITC Launches Investigation into Import of Solar Cells and Modules
On May 23, 2017, the US International Trade Commission (ITC) formally initiated a Section 201 "global safeguard" investigation on crystalline silicon photovoltaic (CSPV) solar cells and modules. The decision marks the formal initiation of a proceeding requested by Suniva, Inc. that could disrupt US imports of solar cells and modules from across the globe. The investigation will proceed quickly; if Suniva is successful, import restrictions could be imposed as early as December 2017. Parties with an interest in this case should develop a strategy and prepare to participate through submission of data, participation in hearings, and filing of briefs.
The ITC is launching this investigation in response to a petition submitted by Suniva, a US solar cell manufacturer that is currently in bankruptcy. The petition seeks an investigation under Section 201 of the Trade Act of 1974. Also known as a "global safeguard" investigation, a Section 201 investigation determines whether a surge in imports of a targeted product—in this case crystalline silicon photovoltaic cells and modules—is causing or threatening serious injury to a US industry.
The purpose of a safeguard case is to provide a domestic industry with temporary relief from imports while it adjusts to increasing import competition. Safeguard actions are very rare in the United States. The last Section 201 investigation was in 2001, when the ITC investigated imports of certain steel products. That investigation eventually resulted in safeguard tariffs of up to 30 percent on steel imports, which were applied for nearly two years.
The relief in a Section 201 case can take the form of increased tariffs, quantitative restrictions on imports, and/or other measures, such as adjustment assistance to the US industry. In its petition, Suniva proposed an additional tariff of up to $0.40 per watt on imports of solar modules and panels and a price floor of $0.78/watt—measures that would significantly increase the price of solar products in the US today.
The ITC's decision to initiate launches a two stage investigation. First, the ITC will determine whether imports are causing serious injury to the US producers. Then, if it finds serious injury, it must recommend appropriate remedies to the President. The President will make the final decision on what to do. The statute allows the ITC only 150 days from filing of the petition on May 17 to complete its injury analysis. It then has an additional 30 days to develop a remedy recommendation. The President must issue a decision within 60 days thereafter.
The investigation will move quickly. Of particular note, parties wishing to participate in the investigation must file a notice of appearance within 21 days of the Federal Register publication announcing the initiation. That notice is likely to be published on or before May 30, 2017. The ITC has announced that the injury hearing will be on August 15, 2017, and its vote on the question of injury will be held on September 22. The hearing on recommended remedies will be on October 3, 2017, and the remedy vote will be on October 31, 2017 (a full schedule is below). The recommendation will then be provided to the President, who, as noted, has 60 days to decide to accept or modify the ITC's recommendation. Import duties or restrictions could be imposed as early as December 2017.
The ITC and the White House will consider the impacts on purchasers and their industries, as well as the alleged injury to the domestic producers. In previous cases, the White House has considered adverse effects on other industries. Therefore, it is advisable for companies with an interest in the US market for solar products to engage not only with the ITC, but also with the Trump Administration, Congress and state-level officials.
For more information on how this case may affect your business and how you can make your views known in the investigation, contact:
Lynn Fischer Fox, Counsel, APKS International Trade Practice
Edward McTiernan, Partner, APKS Environmental Practice
Ethan Shenkman, Partner, APKS Environmental Practice
Sandra Rizzo, Partner, APKS Energy Practice
Kevin O'Neill, Partner, APKS Legislative and Public Policy Practice
ITC Investigation Schedule
May 26, 2017 – Comments of parties on draft questionnaires due
June 29, 2017 – Questionnaires from all parties due back to ITC
August 1, 2017 – Prehearing report due from ITC
August 8, 2017 – Prehearing briefs on injury due
August 15, 2017 – ITC Injury hearing
August 22, 2017 – Post-hearing briefs on injury due
September 22, 2017 – Proposed ITC Injury Vote
September 27, 2017 – Prehearing briefs on remedy due
October 3, 2017 – ITC Remedy hearing
October 10, 2017 – Post-hearing briefs on remedy due
October 31, 2017 – Vote of Remedy ITC