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On June 6, 2022, President Biden declared a national emergency (the “Declaration”) in relation to energy resources and temporarily extended the time of duty-free importation of solar panels and parts from Malaysia, Cambodia, Thailand, and Vietnam. This declaration comes in response to industry concerns over the implications, for ongoing solar energy projects, of the anti-circumvention inquiry by the U.S. Department of Commerce that was initiated on April 1, 2022. The Declaration permits the Secretary of Commerce to waive the collection of duties and other estimated duties on imported solar cells and modules from Thailand, Vietnam, Malaysia, and Cambodia for the next twenty-four months, regardless of the outcome of the anti-circumvention inquiry.

The administration provided a fact sheet, which explains the additional steps that the administration will take to ensure that the domestic industry is supported while the duty waiver is in effect.

  • First, the president will authorize the use of the Defense Production Act to accelerate the domestic production of clean energy technologies
  • Second, the president will actively utilize federal procurement and contracts to provide additional solar manufacturing capacity, and
  • Finally, as stated above, the administration will direct the Secretary of Commerce to delay the application of duties on imports of solar panels and cells for twenty-four months.

This move is mainly spurred by the anti-circumvention inquiry launched on April 1, 2022 by Commerce that aims to identify whether imports of components of solar cells from China, which are currently subject to duties, are imported into Vietnam, Malaysia, Thailand, and Cambodia where they undergo only minor processing in an effort to avoid the import duties on Chinese goods. The petitioner in the investigation, Auxin Solar Inc. (Auxin) alleged that solar cells and modules from Vietnam, Cambodia, Malaysia, and Thailand are utilizing parts from China and therefore circumventing the antidumping duty and countervailing duty orders (“Orders”) currently applicable to imports of solar cells and modules from China.

The Department of Commerce has issued its own statement echoing the Declaration and affirming that it will support the Declaration by altering regulations to ensure the twenty-four-month lift on duties of solar panels from the above-mentioned countries will be enforced. It is unclear at this time whether Commerce will delay the issuance of the preliminary determination in the circumvention case, as well as the final determination, although this seems likely. It is also unclear how the two-year “grace period” will be reconciled with the current effective date of duties if there is an ultimate finding of circumvention, but it seems likely that any circumvention finding only would be prospective after the two years, and not retrospective. We expect that Commerce will clarify this issue in the near future. Importantly, the Declaration will not prohibit Commerce from initiating any new investigations and will not alter any existing duties on solar panels from the above-mentioned countries, if applicable.

This direction of Commerce by the Biden Administration is unprecedented and may be challenged in court by Auxin or another interested party. Such a challenge would likely be brought to the U.S. Court of International Trade in New York.

Husch Blackwell’s International Trade and Supply Chain Team continues to monitor developments related to antidumping and countervailing duty investigations and will provide further updates if or when additional developments occur. Should you have any questions or concerns, please contact Jeff Neeley or Nithya Nagarajan.

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Photo of Jeffrey Neeley Jeffrey Neeley

Jeffrey has more than 25 years of experience representing private parties in international trade remedies disputes in the U.S. and in foreign jurisdictions. He guides clients in matters including antidumping investigations, countervailing duties, subsidies, intellectual property disputes as well as related customs, export…

Jeffrey has more than 25 years of experience representing private parties in international trade remedies disputes in the U.S. and in foreign jurisdictions. He guides clients in matters including antidumping investigations, countervailing duties, subsidies, intellectual property disputes as well as related customs, export control, and other import/export issues.

Photo of Isabella Peek Isabella Peek

A love for international law drew Isabella to Georgetown Law and ultimately to Husch Blackwell.

Isabella’s early career experience working across the United States (D.C., Chicago, Reno, Omaha, Carson City), and experience studying abroad in England and Italy, solidified her ambition to work

A love for international law drew Isabella to Georgetown Law and ultimately to Husch Blackwell.

Isabella’s early career experience working across the United States (D.C., Chicago, Reno, Omaha, Carson City), and experience studying abroad in England and Italy, solidified her ambition to work with clients worldwide. Her passion for international issues is what first drew her to Georgetown Law School, and it later made Husch Blackwell a logical next career step.

Isabella’s skill and ambition made her a formidable competitor on the equestrian team in college, giving her the opportunity to build a high level of self-discipline and contribute to the success of a team. Her time management abilities helped Isabella perform at a high level both academically and as an equestrian. It’s that kind of accomplishment and organization that make her such an effective partner for clients and businesses around the globe.

Photo of Grant Leach Grant Leach

Grant focuses his practice on international trade, international compliance, securities, mergers, acquisitions and general corporate matters.

Photo of Ben Kass Ben Kass

Ben has a wide range of experience in renewable energy development, construction, financing and transactional matters. Prior to joining the firm, Ben served as Senior Counsel for a large international renewable energy company, where he provided legal and business advice on all aspects

Ben has a wide range of experience in renewable energy development, construction, financing and transactional matters. Prior to joining the firm, Ben served as Senior Counsel for a large international renewable energy company, where he provided legal and business advice on all aspects of the company’s activities, including the development, construction, sale and acquisition of utility and distributed scale wind, solar and battery storage projects. Prior to that, Ben was an energy and natural resources lawyer at a large national law firm based in Denver.