EU solar manufacturers demand wider inquiry on Chinese issue

EU ProSun, a group of European solar equipment manufacturers are pressing the European Commission to extend the basis of investigation on China over concerns that they are unfairly subsidising their solar panel industry at the expense of European firms.

The existing allegation being investigated is whether Chinese manufacturers sold solar equipment for less than the cost of making it.

EU and Chinese flags
The European anti-dumping case is already four or five times larger by value than a similar investigation under way in the United States, because the European Union is the biggest export market for Chinese solar panels.

EU ProSun have now asked the commission to look into whether Chinese state banks and the central government offered support that was illegal under World Trade Organization rules.

Milan Nitzschke, president of EU ProSun and a vice president of SolarWorld, a German company, outlined the grievance in a statement. “For example, Chinese banks implement government policy by giving very low interest rates to solar manufacturers, and if the borrower cannot pay back the loan, it may be written off, extended indefinitely or paid off by other government-controlled entities,” “This makes it easier, cheaper and a lot less risky for Chinese solar companies to obtain financing.”

The European solar group also contends that Chinese regions and localities granted subsidies by paying interest, electricity costs, transaction costs for land and value-added taxes, and by offering credit guarantees.

The growth of the Chinese solar equipment industry is a result in large part to the billions of euros in government subsidies that the European Union and national governments have put in place to promote installation of solar panels for homes and businesses.

The commission has 45 days to decide whether to start an investigation.

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