On Dec. 2, 2022, the U.S. Department of Commerce (DOC) released its preliminary determinations over the ongoing investigation into whether solar cells and modules imported from certain Southeast Asian countries were circumventing U.S. duties on solar modules manufactured in the People’s Republic of China.

These findings arrive in the wake of a two-year moratorium on tariffs on solar cells and modules imported from Cambodia, Malaysia, Thailand and Vietnam, as a result of Presidential Proclamation 10414.

The investigation, which began in March 2022, was prompted by allegations made by U.S.-based solar manufacturers against their Chinese competitors, claiming that the accused companies were evading tariffs by selling their products through the four Southeast nations.   

The DOC released its preliminary determinations after a thorough investigation into eight companies based in the four Southeast Asian countries. The DOC preliminarily concluded that four of the eight companies were bypassing U.S. tariffs by exporting Chinese-made solar modules that were only sent to Southeast Asia for minor processing before shipment. The table below summarizes the DOC’s preliminary findings.

Moreover, a few companies in Malaysia, Thailand and Vietnam failed to respond to the DOC’s request for information and were preliminarily deemed to be circumventing U.S. duties as well.

As a result of the DOC’s findings, Cambodia, Malaysia, Thailand and Vietnam have been designated as countries through which solar cells and modules are being circumvented from China. While the designation does not lead to an outright ban over all imports from the four nations, companies based in those countries must certify to the DOC that they are not engaging in circumventing tactics to escape additional duties that result from the circumvention findings.

The DOC is expected to release its final determination on May 1, 2023. In the meantime, as discussed above, it is unlikely that additional duties will be imposed on solar cell imports from those four countries until the end of the two-year moratorium in June 2024. While there have been mixed reactions from the American energy industry over the DOC’s latest findings, U.S. solar importers have ample time to adjust their practices and prepare.