An unidentified equipment supplier to China’s largest producer of both polysilicon and solar wafers, GCL-Poly Energy, is seeking arbitration over unfulfilled order and sales commitments made by its ingot and wafer subsidiary, Taicang GCL Photovoltaic Technology.

In a financial statement, GCL-Poly said that the supplier is claiming a breech of contract in respect to an order its subsidiary placed in 2011, valued at approximately HK$1,800,000,000 (US$232 million).

The supplier is seeking arbitration due to failure to meet equipment unit number order and pay all relevant sums under the purchase order agreement.

GCL-Poly aggressively added ingot and wafer production capacity to reach 6GW in 2012. However, utilisation rates have declined considerably over the last two years as its customers in both China and Taiwan cut cell and module production due to severe overcapacity.

The wafering sector remains chronically in overcapacity mode, despite production cuts and plant closures over the last year.

The supplier to GCL-Poly is seeking unspecified damages.

In January, 2013, Ingot furnace equipment supplier Beijing Jingyuntong Technology Co (JYT) sought and won an arbitration case against LDK Solar for a similar breach of contract.