Solar Installer Alert: Commerce Issues Cash Deposit Instructions to Customs in Taiwan CSPV Products Antidumping Case

On Monday, December 29, 2014, the U.S. Department of Commerce (through its U.S. International Trade Administration or “ITA”) issued instructions to U.S. Customs and Border Patrol (U.S. Customs) for collecting cash deposits specified in the alleged less than fair value import (dumping) investigation against Crystalline Silicon Photovoltaic (CSPV) products from Taiwan.

The U.S. Customs instructions implement the December 16, 2014 Affirmative Final Determination of ITA with respect to CSPV products from Taiwan.  See our report on that December 16 determination for more in-depth coverage.  The decision made an immediate change in the antidumping (AD) cash deposit rates collected by U.S. Customs on subject Taiwanese CSPV products and changed the product scope description of the subject products. 

ITA has now instructed U.S. Customs to collect cash deposits on subject CSPV products entered, or withdrawal from warehouse for consumption in amounts equivalent to the dumping margins determined in the Final Determination, namely:

Taiwanese Industry Dumping Margins/Cash Deposit Rates
 

Rate Category	Final Determination
Gintech Energy, Case No. A-583-853-001	27.55%
Motech Indus., Case No. A-583-853-002	11.45%
All Others, Case No. A-583-853-000	19.50%

The U.S. Customs instructions further provide that if the exporter of the subject products does not have its own cash deposit rate, then the rate for the producer which supplied those products will be used.  If neither the exporter nor the producer has a separate rate, then the “all others” rate of 19.50% will be used.

Change in Scope of CSPV Products Covered

The final scope description for subject Taiwanese CSPV products is more simple to apply and more straightforward.  For the Taiwan investigation, the assembly of CSPV products in Taiwan from cells of any other country but China will exclude the assembled product from the scope of this investigation.  The scope continues to cover Taiwanese cells and CSPV products assembled with Taiwanese cells anywhere but China.  (All CSPV products assembled in China even with Taiwanese cells are now subject to the Chinese AD/subsidy rates.)  The scope continues to exclude any cells or CSPV products made with cells from China since those are already subject to the earlier 2012 AD/subsidy orders against Chinese manufacturers and exporters.  Our February 2014 Alert explains the 2012 cases.

The table below summarizes our view of the new scope description for cells or assembly involving Taiwan and the cases for which these U.S. Customs instructions apply in bold:

 

Table of Scenarios Involving Taiwanese Cells or Assembly
 

Assembly Country	Cell Country	Scope Coverage
China	Taiwan	2014 Cases (China)
China	Any Third Country (including Taiwan)	2014 Cases (China)
Taiwan	Taiwan	2014 Cases (Taiwan Instructions)
Taiwan	China	2012 Cases
Taiwan	Any Third Country	Excluded
Any Third Country (including Taiwan)	China	2012 Cases
Any Third Country	Taiwan	2014 Cases (Taiwan Instructions)

In addition, the scope continues to exclude certain non-silicon photovoltaic products and certain consumer products integrated with less than 10,000mm² of CSPV cells.  See this Fact Sheet for a full scope description.

Changes in Importer and Exporter Certifications Required

As a consequence of changing the scope of the subject CSPV products in the Final Determination, ITA also changed the wording of the importer and exporter certifications to conform to the new scope by which all CSPV products assembled in Taiwan from third country cells other than Chinese cells are excluded from the scope of this investigation.  Previously, importers of CSPV products assembled in Taiwan with third country cells were required to have supporting certifications available in case U.S. Customs requested them to avoid the preliminary AD cash deposits.  Now, since the prior “2-of-3” or “mixed production” rules no longer apply, the prior certification language is outdated.  However, certifications are still relevant to products assembled in Taiwan from third country cells, generally.  The current importer and exporter certification language provided by ITA is found at Appendix II in the Federal Register notice at 79 Fed. Reg. 76966 (Dec. 23, 2014), and the discussion at Id. p. 76967. 

ITA emphasizes that the importer certification must be signed and dated as of the date of entry or withdrawal from warehouse for consumption.  If the exporter is located in Taiwan, the exporter certification must be signed and dated as of the date the products ship.  Sufficient documentation to support the certifications should be available as well.  Although neither ITA nor U.S. Customs has specified exactly what this supporting documentation should be, we have seen and suggest that all shipping documents, invoices, manufacturing certifications and bills of materials (BOM) should be available and consistent with the certifications.   We recommend that importers consult with their Customs brokers to verify the supporting documents generally desired for the Customs inspectors at the port of entry.

Timing for Cash Deposits for Taiwan CSPV Products

All subject CSPV products entered prior to the publication of the ITA’s Affirmative Preliminary Determination on July 31, 2014, are subject to normal tariff rates and no AD cash deposits.  These products should be liquidated in the normal manner.  Beginning on July 31, 2014, U.S. Customs was instructed to suspend liquidation of the subject CSPV products and collect cash deposits at the rates set forth in the Affirmative Preliminary Determination.  Effective December 23, 2014, U.S. Customs started collecting cash deposits at the rates set forth in the Affirmative Final Determination and explained in this Alert.  These cash deposit rates will continue until the publication of a final order in the Taiwan investigation, unless the U.S. International Trade Commission (USITC) makes a negative injury determination at the end of January, 2015.  If so, then U.S. Customs will immediately stop collecting cash deposits and all cash deposits previously collected will be refunded.  If the USITC makes an affirmative injury determination, then any changes to the cash deposit rates will be reflected in the ITA final orders in early February, 2015, and subsequent update of these U.S. Customs instructions.  See our recent Alert on the USITC investigations for more details.

Normally, U.S. Customs will continue to suspend liquidation of subject products and collect cash deposits until the completion of the 1st Administrative Review of actual subject product imports for the time period designated in the Administrative Review notice.  Upon publication of final results of the Administrative Review, ITA normally instructs U.S. Customs to liquidate subject products entered during the period of the Administrative Review at the dumping margins determined in the final results and sets the new cash deposit rates for those entries for which liquidation continues to be suspended until the next Administrative Review.  The AD rates determined in an Administrative Review can be higher or lower than the cash deposit rates in force during the period of review.  This may cause importers to receive a refund or pay a surcharge depending on the adjustment and final AD rates established. 

A table summarizing this process is set out below for convenient reference.

Table Summarizing Various Cash Deposit Rate Changes
 

Time Period/Phase	Trigger Event	Applicable Cash Deposit Rates	Adjustable
Before 7/31/2014	N/A	None	No
7/31/2014 to 12/22/2014	Published Affirmative Preliminary AD Determination	Preliminary Cash Deposit Rates	Yes, depending on USITC and ITA corrections
12/23/2014 to Final Order*	Published Affirmative Final AD Determination	Final Cash Deposit Rates	Yes, upon final order
Final Order to Final Results of 1st Admin. Review*	Published Final Orders	Final Order Cash Deposit Rates	Yes, upon final results of 1st Admin. Review
Subsequent Admin. Reviews*	Published Final Results of Previous Admin. Review	Final Results of Admin. Review for both AD and Cash Deposit Rates	Yes, upon final results of next Admin. Review

*These Phases are conditional on an affirmative final injury determination by the U.S. International Trade Commission, due at the end of January, 2015.

Next Steps and Uncertainty

Now, we look forward to the USITC’s scheduled vote on January 20, 2015, and issuance of its Final Determination.  The results of that vote, and any error adjustments from the ITA proceeding, will determine the final details of the Taiwan AD rates for the future.  It is also possible that U.S. Customs collected cash deposits in the past few months on certain products that are no longer subject to the scope of this investigation.  For example, under the prior “2-of-3” or “mixed production” rule embodied in the scope of the Preliminary Determination, modules assembled in Taiwan from third country cells that utilized ingots, wafers or pre-processing services from Taiwan were captured under that prior scope and cash deposits were required. See our scope comments in our earlier Alert on the prior scope.  By contrast, the new scope excludes all modules assembled in Taiwan so long as the cells originate from a third country, regardless of whether some inputs were sourced from Taiwan.  Importers of those previously “in scope” CSPV products will be anxiously awaiting notice on how and when those cash amounts will be refunded.  ITA will issue orders in early February, 2015, as well as instructions to CBP to apply the AD remedies to all goods in scope.

Stoel Rives Updates

The Stoel Rives Energy Trade Team will monitor further developments in these Solar Trade Cases and report on events as they occur, including the impending USITC final determinations.   For more information, please contact the following a key contributor.