EU set to end Chinese solar panel import controls in September

By Philip Blenkinsop

BRUSSELS (Reuters) - The European Union will scrap import controls on solar panels and cells from China in September, rejecting a request from EU producers who argue that the bloc will be opening its doors to a flood of dumped products.

The European Commission, which coordinates EU trade policy, proposed dismissing the request for an "expiry review" and received backing from a majority of the EU's 28 countries, according to EU sources familiar with the discussions.

The European Union first imposed anti-dumping and anti-subsidy measures for Chinese solar panels, wafers and cells in 2013 and extended them in March 2017 by 18 months, signalling that they should then end.

Chinese manufacturers are allowed to sell solar products in Europe free of duties if they do so at or above a minimum price that has progressively declined. If sold for less than that price, they are subject to duties of up to 64.9 percent.

The European Union has faced a delicate balancing act between the interests of EU manufacturers and those such as importers and installers pressing for a reduction in the cost of solar power generation.

It has also been concerned about the response from Beijing given the two sides were on the verge of a trade war over the issue in 2013.

EU ProSun, the grouping of EU producers that launched the initial complaint in 2012, had said there were good reasons for measures to be prolonged.

Beijing's decision to limit installations meant Chinese producers had some 30 gigawatts of excess capacity to shift with few markets to sell into after tariffs imposed by the United States and planned by India, the second and third largest markets behind China. The total EU market is some 7 gigawatts.

"Only the EU is at the same time irresponsibly dropping all measures and inviting Chinese producers to eliminate European and third-country competition in the EU market," EU ProSun president Milan Nitzschke said, adding some companies were considering a legal challenge at the European Court of Justice.

SolarPower Europe, which represents those in the solar industry opposed to duties, has referred to Commission and EY studies indicating demand could increase by up to 30 percent, creating about 45,000 jobs if the measures were removed.

(Reporting by Philip Blenkinsop; Editing by Dale Hudson)