China | Brussels, 27 April 2013
EU launches anti-subsidy investigation on solar glass from China
The European Commission today initiated an anti-subsidy investigation into imports of solar glass from China. The initiation is based on a complaint lodged by the association EU ProSun Glass, which claims solar glass from China is being subsidised in China and then sold in the EU at prices below market value and causing material injury to the EU solar glass industry. An anti-dumping investigation into imports of solar glass from China is currently ongoing. This proceeding was initiated on 28 February 2013 (MEMO/13/153).
The anti-subsidy investigation could take up to 13 months, although under trade defence rules the EU could impose provisional anti-subsidy duties within nine months if it considers these necessary.
Solar glass is a special glass used mainly, but not exclusively, for the production of solar panels. It is an essential component not just of solar panels, but of many solar energy products.
This investigation has, however, no direct link with the probe related to the imports of solar panels launched by the European Commission last September (MEMO/12/647): it is a stand-alone investigation concerning a clearly distinct product. The EU solar glass market is valued at less than €200m.
Why is the European Commission opening this investigation?
The Commission is legally obliged to open an anti-subsidy investigation when it receives a duly substantiated complaint from EU producers which provides prima facie evidence that exporting producers from one or more countries outside the EU are subsidising a product which is then sold on to the EU market and causing material injury to the EU industry.
EU ProSun Glass, an ad hoc association representing European solar glass manufacturers, lodged just such an anti-subsidy complaint on 14 March 2013 in which it argues that the Chinese exporting producers of solar glass have benefited from a number of subsidies granted by the Government of China. EU ProSun Glass's collective output represents considerably more than the 25% of Union production required by law. EU ProSun Glass is not formally affiliated with EU ProSun, a separate coalition of solar equipment manufacturers which launched the solar panel complaint last year.
The Commission found that the complainant brought sufficient elements showing:
1. possible subsidies benefiting the exporting producers in China;
2. injury suffered by the Union industry; and
3. a possible causal link between the subsidised imports and the injury suffered by the Union industry.
The Commission concluded that there was sufficient prima facie evidence to warrant the opening of an investigation.
What happens next?
The European Commission will send out questionnaires to various interested parties, such as exporting producers, Union producers, importers and associations. It will ask for information relating to the exports, production, sales and imports of solar glass. Once the interested parties have responded to the questionnaires, the Commission will verify the data, often by going to the premises of the companies.
On the basis of the information it has collected, the Commission will establish if subsidisation has taken place and whether the injury claimed is a result of the subsidised imports. This examination will also include consider possible other factors that might have contributed to the injury.
In addition, the Commission will carry out the so-called "Union interest test". The EU is the only WTO Member to systematically carry out such tests. The Commission will consider whether the potential imposition of measures would be more costly to the EU economy as a whole than the benefit of the measures would be to the complainants. The Commission will assess the level of duty needed to counteract the injurious effects of the subsidy. Measures, if any, will be imposed at the level of subsidy or injury whichever is the lower – the so-called 'lesser duty rule.' By systematically applying the 'lesser duty rule', the EU goes beyond its WTO obligations.
Within nine months of the start of the investigation, the Commission will issue its provisional findings. There are three possible scenarios:
(a) impose provisional anti-subsidy duties (normally for a four months period);
(b) continue the investigation without imposing provisional duties; or
(c) terminate the investigation.
Throughout the investigation, all interested parties have a right to make their views and arguments heard by sending in comments to the Commission and/or taking part in hearings. The Commission takes account of the comments received and addresses these in the remainder of the investigation.
The Council is legally obliged to take a final decision on the imposition of any definitive measures within 13 months of the investigation being started. In the present case, that means before 26 May 2014. The final findings will be published in the Official Journal of the European Union.
For further information:
- On EU Trade defence policy
- On the on-going anti-dumping investigation on imports of solar glass from China
- On-going investigations on imports of solar panels and their main components (i.e. modules and cells) from China: