Exclusive: Error leaves at least 16 Chinese manufacturers in EU trade limbo

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Updated: A clerical oversight in China has resulted in at least 16 manufacturers being excluded from the EU trade agreement, PV Tech has learned.

A list of companies that were party to price undertaking has left multiple names out, despite the companies claiming they agreed to deal that came into force today.

As a result they will now be subject to the EU’s punitive anti-dumping tariffs, which are as high as 47.6%. One of the companies involved, which asked not to be named, said it would take at least a month to fix the error. It is now assessing its options

Companies listed in the annex of an EU document published on 3 August are excluded from the duties on the agreement that they implement a minimum import price. PV Tech has confirmed with multiple manufacturers that this level will initially be set at €0.56 per Watt. This level will be held for 12 months from 6 August before being reappraised.

A spokeswoman for the European Commission told PV Tech the list was submitted by the Chinese Chamber of Commerce (CCCME).

“The companies that are included in the Commission Regulation exempting them from anti-dumping duties are the ones that participate in the undertaking. This list of companies has been submitted by the CCCME, following many careful checks, leading to the submission of a formal offer on behalf of the Chinese exporting companies on 27 July. All companies that are on the list have cooperated in the investigation. The undertaking is now closed with the legislation having been adopted,” they said.

Meanwhile, no details on whether the price refers to products as they pass through the factory gate or includes delivery and shipping costs have been confirmed to manufacturers as of yet.

Manufacturers are currently two days into a training session in Beijing to familiarise them with how to implement the price undertaking. The fine details of the mechanism are not expected until after the conclusion of that session later this week.

The total size of an import cap on Chinese manufacturers is also unknown. There was speculation that it would be 7GW, around 70% of the EU market. What is known is that caps have been allocated to each manufacturer based on the past 12 months’ shipments. This will restrict changes in the respective market share of each manufacturer.

The regulations are the subject of a legal challenge with the restrictions on imports thought to breach European anti-competition laws. As the price undertaking is a response to dumping, it is thought that some of these do not apply.

Module shipment quota

A key part of the agreement rests with Chinese authorities managing over 100 manufacturers individually set annual quota of module shipments into the EU, which will be monitored by EU authorities. 
PV Tech has been told that in many instances key customers such as large distributors and PV project developers will be told by the manufacturers what shipment (MW) quota they have been allocated for the next 12-months. 
Key to this is an effort to provide transparency and avert possible supply/allocation concerns or counter unfounded claims by possible rivals providing misinformation on rumoured supply constraints to lure buyers. 
Although the quota levels for individual companies are not expected to be released publically by the European Commission it is understood that companies signed-up to the agreement have been provided individual quota levels that respond to company disclosed data on module shipments in 2012 and the first-half of 2013. 
According to data compiled by PV Tech on six leading, publically traded Chinese module manufacturers 2012 shipment data, companies such as Yingli Green, Trina Solar, Canadian Solar, JinkoSolar, JA Solar and Hanwha SolarOne could have been allocated around half of the rumoured 7GW annual cap (see table left). 
Companies such as ReneSola, which have third-party manufacturing agreements in Europe of around 300MW could potentially be able to double its market share in the EU as it would also be able to ship modules into the region from China. 
The data in the table corresponds to the listed companies official total module shipments for 2012 and PV Tech estimations of as to total shipments within the European region. None of the listed companies’ breakout shipments specifically for the EU, while some do not provide regional breakouts in general, though the likes of Trina Solar do.                  
It is hoped that official quota levels for leading manufacturers will become known in due course and an update and expanded quota list provided. 

Additional reporting by Mark Osborne

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