Solar negotiations with European Commission fail

EU excludes talks before probe results announced

A leading trade organization announced on Wednesday that first-round talks between China and the European Commission over a solar trade probe have broken down. The announcement came as the European Union excluded further talks until the probe's preliminary determinations are published.

The Chinese government and the EC had agreed that the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, or CCCME, would represent the Chinese PV industry and begin consultations with the Brussels-based commission on the anti-dumping and anti-subsidy investigations against Chinese PV products, the CCCME said in a statement on its website.

The CCCME recently sent a delegation to meet with the commission following the latter's invitation. The Chinese delegation put forward a practical and workable proposal upon the commission's request, according to the statement.

"However, the proposal was firmly and entirely rejected by the European Commission without any explanation. Besides, there was no response from the commission regarding the questions raised by the CCCME delegation and we regret that," Zhang Yujing, head of the CCCME, told a news conference on Wednesday in Beijing.

The European side did not demonstrate its sincerity to resolve trade issues through consultation, leading to a lack of results from the first round of the consultations and to the breakdown, said the statement.

"Most Chinese and European PV companies are looking forward to resolving the issue through consultation. It's our sincere hope that the European Commission can demonstrate its sincerity and have full and in-depth discussions with the Chinese side on these issues as soon as possible," said Wang Guiqing, deputy head of the CCCME.

Wang declined to disclose any details about the talks.

The commission launched its anti-dumping probe into Chinese solar panels on Sept 6, and started the anti-subsidy investigation on Nov 8. The commission is scheduled to issue a preliminary ruling for the anti-dumping probe by June 6 and for the anti-subsidy probe by Aug 8.

Media reports have said that the commission is planning punitive tariffs ranging from 37.3 percent to 67.9 percent on Chinese solar panels.

Helene Banner, a press officer at the office of EU Trade Commissioner Karel De Gucht, told China Daily in an e-mail: "The commission has maintained the communication lines open with China and been ready to engage in constructive discussions to find solutions. Various contacts have taken place, at both political and technical levels. However, we cannot comment on the content of those discussions and regret that the Chinese chamber (the CCCME) is doing so. We cannot identify ourselves with those statements.

"At the moment, technical exchanges are taking place. Negotiations will only be possible once preliminary determinations are published in the EU's Official Journal. The European Commission looks forward to constructive discussions on possible solutions," Banner said.

"The failure of the consultations signals that punitive duties from the preliminary ruling are unavoidable," said Yao Weiqun, associate president of the Shanghai World Trade Organization Affairs Consultation Center.

"The punitive duties, if imposed, will greatly damage Chinese solar companies as well as the global solar industry," Wang at the CCCME said.

"China should continue the consultations and negotiations even after the preliminary ruling but I advise the Chinese government to make a move," said Tu Xinquan, deputy director of the China Institute for WTO Studies at the University of International Business and Economics in Beijing.

German Vice-Chancellor and Economy Minister Philipp Roesler said over the weekend that the European Commission's decision to support a proposal to impose punitive duties on Chinese solar panels is a "grave mistake".

China's trade with the EU declined 1.3 percent year-on-year in the first four months of the year, according to figures from the General Administration of Customs.