The U.S. Court of International Trade (CIT) has ruled that a 2022 executive order made by the President of the United States was illegal, and Customs and Border Protection (CBP) should not have followed it.
This all stems from a lawsuit filed by solar panel assembler Auxin Solar asking the international trade court to review the legality of a two-year tariff pause President Joe Biden ordered on solar panels imported from Cambodia, Malaysia, Thailand and Vietnam. The president ordered the pause while the Dept. of Commerce investigated whether Chinese solar panel manufacturers were working in the four Southeast Asian countries as a way to circumvent existing antidumping/countervailing duties (AD/CVD). At the time of the investigation, solar panels from Southeast Asia made up 80% of supply in the United States, and exporters stopped bringing in more panels for fear of high retroactive duties. Biden’s two-year tariff pause was to ensure a sufficient supply of solar panels to meet domestic electricity generation needs.
Auxin claimed that the president’s June 2022, executive order was “an abuse of discretion” and tariffs should have been collected.
The CIT in August decided Auxin was right, vacating the Dept. of Commerce’s guidelines for following the president’s executive order. Retroactive duties will now be collected on Southeast Asian solar cells and panels imported between April 1, 2022 (the date the circumvention investigation was initiated) and June 6, 2024 (the expiration of the executive order emergency).
Court case history
At the end of 2023, Auxin Solar filed a lawsuit in the CIT against Commerce and CBP for not collecting fees and credits on solar imports from Southeast Asia using Chinese components. Although Commerce did make an affirmative decision in August 2023 that Southeast Asian solar imports were being unfairly subsidized and dumped into the U.S. market, the department complied with the ordered two-year pause and waited to begin collecting cash deposits until after the emergency order lifted. Auxin sued the government for following the president’s orders.
Auxin was joined on the plaintiff side of the lawsuit by Concept Clean Energy, a small designer of “solar structures” based in Southern California. Both Auxin and Concept have little online presence, and their significance in the U.S. solar market has been questioned. Auxin Solar was previously marketed as a “boutique” solar panel assembler and had a small manufacturing footprint of less than 150 MW each year. Regardless, the two companies told the CIT in their original petition that the government’s lack of duty collection was preventing both companies from manufacturing product and installing projects with domestic content.
Supporting Commerce and CBP on the defendant side included advocacy groups American Clean Power Association (ACP) and the Solar Energy Industries Association (SEIA); utility-scale developers NextEra and Invenergy; and global solar panel manufacturers Boviet Solar, BYD, Canadian Solar, JA Solar, JinkoSolar, Risen Energy and Trina Solar.
August 2023 AD/CVD results
The wording in the 2023 AD/CVD decision against Chinese solar imports from Cambodia, Malaysia, Thailand and Vietnam allowed for some workarounds. (This is not to be confused with the 2025 AD/CVD decision that is more generalized and doesn’t name Chinese companies specifically.)
The 2023 decision extended tariffs to Southeast Asian exports of (1) silicon cells using Chinese wafers and (2) silicon solar panels using Chinese wafers that also use three additional Chinese-made materials (silver paste, aluminum frames, glass, backsheets, EVA sheets or junction boxes). Manufacturers in Southeast Asia that used non-Chinese wafers and at least four solar components made outside of China were exempt from the AD/CVD orders. These rules seemed fairly easy to comply with, and less product was expected to be tariffed than originally thought. That’s why a second AD/CVD investigation was launched in 2024.
Retroactive duty collection details
Solar Power World spoke with Thomas Beline, partner at Cassidy Levy Kent and counsel for Auxin and Concept Clean Energy, before the public version of the CIT decision was released. He said that CBP was already reviewing solar imports during the 2022-2024 period in anticipation of the CIT making this favorable decision on behalf of Auxin.
During oral arguments of the case, the Dept. of Justice stated that there were approximately 44,000 “entries” at issue (imported solar products from Southeast Asia) and that CBP had individually examined approximately 26,000 entries.
“To do so, [CBP] administratively extended liquidation of these entries, keeping them open for examination beyond the standard 314 days after entry-date for final liquidation,” Beline said. “In its examination, it found that none of the entries complied with the tariff moratorium rules, and it issued bills for non-compliance. The other 18,000 or so entries are still being examined. These were all subject to extension of liquidation.”
Beline said that CBP’s manual review was already applying retroactive duties, and now CIT’s decision provides CBP with additional authority to continue the reviews and apply the tariffs.
The Coalition for a Prosperous America (CPA), a bipartisan non-profit organization representing domestic manufacturers, released a report earlier this year calculating the results of extending retroactive duties on solar imports. U.S. importers brought in roughly 88.2 GW of solar cells and panels from Cambodia, Malaysia, Thailand and Vietnam during the 2022-2024 period, which could result in upward of $67.4 billion in retroactive duties. Taking into account exemptions and product found to be in compliance, CPA conservatively puts potential retroactive duties at $53.9 billion.
