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EU probes subsidies to Chinese solar panel makers

08.11.12 | News

The European Commission opened a fresh probe into Chinese solar panel makers on Thursday, raising the heat in the latest dispute between China and its Western trading partners.The Commission said it had "launched an anti-subsidy ... investigation into imports of solar panels and their key components" made in China after industry lobby group EU ProSun charged that Beijing was giving its companies unfair subsidies, reported AFP.

"In terms of value of imports affected, this is the most significant anti-subsidy complaint the European Commission has received so far: in 2011, China exported solar panels and their key components worth around 21 billion euros to the EU," it said.

The investigation will take 13 months but duties could be imposed within nine months if the probe finds sufficient evidence of illegal subsidies, it added.

The move comes after China announced last week a similar probe into European exports of solar-grade polysilicon, a key component, escalating a bitter trade row with the EU after Brussels launched an inquiry into Chinese products in September.

Beijing said it would examine whether European firms sold at artificially low prices in China and had received subsidies which allowed them to compete unfairly with Chinese companies.

European companies affected were given 20 days to respond, with China aiming to complete the investigation within a maximum of 18 months.

Then on Monday this week, China also filed a complaint with the World Trade Organization against the EU over what it claimed to be unfair help for European solar energy firms, a source close to the WTO said.

"China is claiming that certain measures affecting the renewable energy generation sector ... include domestic content restrictions and are inconsistent with the WTO rules," the source said.

More than 60 percent of China's $35.8 billion worth of solar product exports went to the EU last year, according to Chinese industry figures, while the country imported $7.5 billion of European solar equipment and raw materials.

China has also urged the United States to withdraw hefty anti-dumping and anti-subsidy duties of up to 250 percent on Chinese solar-cell makers.

Beijing on July 20 launched its own investigation into alleged US subsidies for and dumping of solar-grade polysilicon after Washington's move.

In June, the EU, the United States and Japan asked the WTO to help resolve a dispute over Beijing's export controls on rare earths, key minerals used in many high-tech products.