Changzhou Trina Solar Energy Co. v. United States

Slip Op. 18-166
UNITED STATES COURT OF INTERNATIONAL TRADE
CHANGZHOU TRINA SOLAR ENERGY
CO., LTD., and TRINA SOLAR
(CHANGZHOU) SCIENCE &
TECHNOLOGY CO., LTD.,
Plaintiffs,
CANADIAN SOLAR INC., CANADIAN
SOLAR INTERNATIONAL, LTD.,
CANADIAN SOLAR MANUFACTURING
(CHANGSHU), INC., CANADIAN SOLAR
MANUFACTURING (LUOYANG), INC.,
CANADIAN SOLAR (USA) INC., CSI
CELLS CO., LTD., CSI SOLAR POWER
(CHINA) INC., CSI SOLARTRONICS
(CHANGSHU) CO., LTD., CSI SOLAR Before: Jane A. Restani, Judge
TECHNOLOGIES INC., and CSI SOLAR
MANUFACTURE INC.,
Consol. Court No. 17-00198
Plaintiff-Intervenors,
38%/,&9(56,21
v.
UNITED STATES,
Defendant.
SOLARWORLD AMERICAS, INC.,
CHANGZHOU TRINA SOLAR ENERGY
CO., LTD., and TRINA SOLAR
(CHANGZHOU) SCIENCE &
TECHNOLOGY CO., LTD.,
Defendant-Intervenors.
OPINION AND ORDER
Dated: November 30, 2018
Consol. Court No. 17-00198 Page 2
[Commerce’s Final Results in the Third Administrative Review of Commerce’s Countervailing
Duty Order pertaining to photovoltaic cells from the People’s Republic of China are partially
sustained and partially remanded for reconsideration consistent with this opinion.]
Robert Gosselink, and Jonathan Freed, Trade Pacific, PLLC, of Washington, D.C., for
Plaintiffs and Defendants-Intervenors Changzhou Trina Solar Energy Co., Ltd. and Trina Solar
(Changzhou) Science & Technology Co., Ltd.
Craig Lewis, Hogan Lovells US LLP, of Washington, D.C., for Consolidated Plaintiffs
Shanghai BYD Co., Ltd. and BYD (Shangluo) Industrial Co., Ltd.
Jeffrey S. Grimson, Kristin H. Mowry, Jill A. Cramer, Sara M. Wyss, James C. Beaty,
and Bryan P. Cenko, Mowry & Grimson, PLLC, of Washington, D.C., for Plaintiffs-Intervenors
Canadian Solar Inc., Canadian Solar International, Ltd., Canadian Solar Manufacturing
(Changshu), Inc., Canadian Solar Manufacturing (Luoyang), Inc., Canadian Solar (USA) Inc.,
CSI Cells Co., Ltd., CSI Solar Power (China) Inc., CSI Solartronics (Changshu) Co., Ltd., CSI
Solar Technologies Inc., and CSI Solar Manufacture Inc.
Chad A. Readler, Jeanne E. Davidson, Tara K. Hogan, and Justin R. Miller, International
Trade Field Office, U.S. Department of Justice, of New York, NY. Of counsel on the brief was
Paul Keith, Office of Chief Counsel for Trade Enforcement and Compliance, U.S. Department of
Commerce, of Washington, D.C.
Timothy Brightbill, Laura El-Sabaawi, and Usha Neelakantan, Wiley Rein, LLP, of
Washington, D.C., for Defendant-Intervenor SolarWorld Americas, Inc.
Restani, Judge: In this action challenging a final determination issued by the United
States Department of Commerce (“Commerce”) in Commerce’s Third Administrative Review of
the countervailing duty order on crystalline silicon photovoltaic cells, whether or not assembled
into modules (“solar cells”) from the People’s Republic of China (“PRC”), covering the period
from January 1, 2014, through December 31, 2014. See Crystalline Silicon Photovoltaic Cells,
Whether or Not Assembled Into Modules, From the People’s Republic of China: Final Results of
Countervailing Duty Administrative Review, and Partial Rescission of Countervailing Duty
Administrative Review; 2014, 82 Fed. Reg. 32, 678 (Dep’t Commerce July 17, 2017) (“Final
Results”), amended by Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into
Court No. 17-00198 Page 3
Modules, From the People’s Republic of China: Final Results of Countervailing Duty
Administrative Review, and Partial Rescission of Countervailing Duty Administrative Review;
2014, 82 Fed. Reg. 46,760 (Dep’t Commerce Oct. 6, 2017) (“Amended Final Results”),
Changzhou Trina Solar Energy Co., Ltd., Trina Solar (Changzhou) Science & Technology Co.,
Ltd. (collectively, “Trina”), Consolidated Plaintiffs BYD (Shangluo) Industrial Co., Ltd.
(“Shangluo BYD”) and Shanghai BYD Co., Ltd. (“Shanghai BYD”) (collectively, “BYD”); and
Canadian Solar Inc., Canadian Solar International, Ltd., Canadian Solar Manufacturing
(Changshu), Inc., Canadian Solar Manufacturing (Luoyang), Inc., Canadian Solar (USA) Inc.,
CSI Cells Co., Ltd., CSI Solar Power (China) Inc., CSI Solartronics (Changshu) Co., Ltd., CSI
Solar Technologies Inc., and CSI Solar Manufacture Inc. (collectively, “Canadian Solar”)
request the court hold aspects of Commerce’s final determination to be unsupported by
substantial evidence or otherwise not in accordance with law.
The United States (“Defendant”) asks that the court sustain Commerce’s Final Results of
its third administrative review. SolarWorld Americas, Inc. (“SolarWorld”) requests the court to
uphold other portions of Commerce’s Final Results as supported by substantial evidence and
otherwise consistent with law and asserts that other portions are not.
BACKGROUND
Commerce first published a countervailing duty order on solar cells from the People’s
Republic of China (“PRC”) on December 7, 2012. See Crystalline Silicon Photovoltaic Cells,
Whether or Not Assembled Into Modules, From the People’s Republic of China: Countervailing
Duty Order, 77 Fed. Reg. 73,017 (Dep’t Commerce Dec. 7, 2012). In 2016, Commerce initiated
its third administrative review of this countervailing duty, covering the period from January 1,
Consol. Court No. 17-00198 Page 4
2014 to December 31, 2014. Canadian Solar and Trina were selected as mandatory respondents
(“Respondents”) and issued questionnaires along with the Government of the PRC (“GOC”).
See Decision Memorandum for Final Results and Partial Rescission of Countervailing Duty
Administrative Review: Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into
Modules, from the People’s Republic of China; 2014, 1 (Dep’t Commerce July 10, 2017) (“I&D
Memo”). On January 9, 2017, Commerce published its preliminary results of the administrative
review. Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From
the People’s Republic of China, 82 Fed. Reg. 2,317 (Dep’t Commerce Jan. 9, 2017) (Prelim.
Results) and accompanying issues and decision memorandum (Prelim. I&D Memo). After
receiving submissions from interested parties, Commerce issued its Final Results on July 17,
2017, later amended on October 6, 2017. 82 Fed. Reg. 32,678 1; Amended Final Results, 82 Fed.
Reg. 46,760. The Amended Final Results calculated a subsidy rate of 18.16 ad valorem for
Canadian Solar, 17.14 percent ad valorem for Trina, and 17.49 ad valorem for non-selected
companies under review. 82 Fed. Reg. at 46,761. Plaintiff and Plaintiff-Intervenors challenge
1
The Final Results were amended in order to correct ministerial errors in calculating the benefit
Canadian Solar received from the “Preferential Policy Lending Program” and in “calculating the
inland freight values.” See Amended Final Results, 82 Fed. Reg. at 46,761. The corrected error
resulted in a smaller subsidy rate for Canadian Solar and the subsidy rates for seventeen
additional companies. Id. No party has raised any issue with this aspect of the Amended Final
Results.
Court No. 17-00198 Page 5
several aspects of the Final Results, as amended. 2
JURISDICTION AND STANDARD OF REVIEW
The court has jurisdiction pursuant to 28 U.S.C. § 1581(c) and 19 U.S.C. § 1516a(a)(2)
(2012). Commerce’s results in a countervailing duty proceeding are upheld unless “unsupported
by substantial evidence on the record, or otherwise not in accordance with law[.]” 19 U.S.C. §
1516a(b)(1)(B)(i).
DISCUSSION
Because the parties present a variety of fact-specific claims, the following opinion
addresses the factual background for each in turn. Each section notes which parties are bringing
a given claim.
I. Export Buyer’s Credit Program
a. Commerce’s decision to apply adverse facts available to cooperating parties
i. Background
In the course of the third administrative review, Commerce requested information about
the Exports Buyer’s Credit Program (“EBCP’) from the GOC. Canadian Solar, and Trina. See
2
Consolidated Plaintiffs BYD (Shangluo) Industrial Co., Ltd. and Shanghai BYD Co., Ltd.
(“Shanglou”) largely do not present their own arguments but “instead hereby support[],
incorporate[], and adopt[] by reference” all of Canadian Solar and Trina’s arguments “to the
extent they challenge the rates” that they received from Commerce. Memorandum in Support of
Rule 56.2 Motion for Shanglou, Doc. No. 45-1, at 10 (Feb. 21, 2018). The court notes their
support for Plaintiff and Plaintiff-Intervenor’s challenges and will not indicate it further.
Consol. Court No. 17-00198 Page 6
Prelim I&D at 2–3. 3 The latter two submitted affiliate and customer certifications of non-use
applicable to the period of review stating that U.S.-based customers had not benefitted from the
EBCP. See Trina Section III Questionnaire Response at 75, P.D. 81–98 (May 3, 2016); Trina
Benchmark Submission (BPI Version) at Ex. 10., C.D. 105–107 (Nov. 30, 2016); Canadian Solar
Section III Questionnaire Response at Vol. II, Ex. 20, P.D. 116–22, C.D. 31–37 (June 10, 2016).
The GOC, however, refused to provide information on potential third-party bank involvement in
the EBCP, 4 arguing that such information was irrelevant to Commerce’s determination regarding
whether the program had been used by the relevant parties. I&D Memo at 13.
Unlike in the second administrative review, 5 in which Commerce declined to apply an
adverse inference with regard to facts otherwise available (“AFA”) against otherwise
cooperating respondents based on the GOC’s refusal to provide requested EBCP information,
3
The U.S. government imposes duties on imports when a government or public entity is found to
be providing a countervailable subsidy for the manufacture, production, or exportation of the
merchandise imported into the United States, if the class of goods subsidized either materially
injures or threatens to materially injure an industry in the United States. See 19 U.S.C. § 1671(a).
4
Trina submitted certifications of non-use for its sole U.S. customer, TUS, whereas Canadian
Solar submitted certifications for most of the sales of relevant merchandise–[[ ]]. See
Memorandum in Support of Motion of Trina for Judgment Upon the Agency Record, Doc. No.
46-3 at 9 (Feb. 21, 2018) (“Trina Br.”); Memorandum of Points and Authorities in Support of
Rule 56.2 Motion for Judgment on the Agency Record by Canadian Solar, Doc. No. 43-1 at 10
(Feb. 21, 2018) (“Canadian Solar Br.”). Although Canadian Solar did not submit certifications
for all of its U.S. customers, Commerce did not address this during the administrative review.
See Defendant’s Supplemental Brief Regarding the Application of Adverse Facts Available to
the Export Buyer’s Credit Program, Doc. No. 90 at 5 (Nov. 2, 2018) (“Def. Supp. Br.”).
5
The court upheld Commerce’s decision to not apply AFA to cooperating parties when they
submitted verifications of non-use in the second administrative review. See Changzhou Trina
Solar Energy Co., Ltd. v. United States, 255 F. Supp. 3d 1312, 1318–19 (CIT 2017).
Court No. 17-00198 Page 7
Commerce here concluded that the intervening 2013 revisions 6 to the EBCP made Respondents’
certifications of non-use insufficient to establish non-use. See I&D Memo at 13; Prelim. I&D
Memo at 30–31. The 2013 change to the program allowed for the involvement of third party
banks in the EBCP and Commerce reasoned that, given the GOC’s refusal to answer questions
regarding whether and how these banks extended credit, it was impossible to verify
Respondents’ certifications of non-use. See I&D Memo at 13. Commerce found that “[a]bsent
the requested information, the GOC’s claims that the respondent companies did not use this
program [were] not reliable” and therefore applied AFA to all parties in calculating the amount
of subsidization based on the EBCP. Id.
Trina and Canadian Solar argue that Commerce disregarded record evidence showing
that they did not receive support from the EBCP. Trina Compl. at ¶ 10; Trina Br. at 7–9;
Canadian Solar Br. at 8–14. Canadian Solar further argued that it was improper to use AFA
against a cooperating party and that Commerce’s decision is arbitrary as it contradicts
Commerce’s previous rulings in similar situations. Canadian Solar Br. at 9, 12–13. Trina
disputes Commerce’s assertion that the non-use of third party banks was unverifiable and
contends that Commerce could have requested further documentation on Trina’s loans in order to
verify non-use. Trina Br. at 14; Reply Brief of Plaintiffs Changzhou Trina Solar Energy Co., and
Trina Solar (Changzhou) Science and Technology Co., Doc No. 79 (“Trina Reply Br.”) at 11–13
6
Commerce identified two potential changes to the program in 2013. First, prior to the 2013
changes, the program was only available to those with contracts over two million U.S. dollars
and Commerce noted that information on the record indicated that this requirement was
eliminated. Prelim. I&D Memo at 30. Second, information on the record indicated that China Ex-
Im bank may be distributing credits through third-party banks. Id.; I&D Memo at 13. Commerce,
Consol. Court No. 17-00198 Page 8
(Sept. 21, 2018). Canadian Solar argues that the affidavits of non-use were sufficient and no
other documentation was necessary. Canadian Solar Br. at 10–12. Defendant claims that
Commerce was correct in finding that respondents used the EBCP based on an adverse inference
given the GOC’s failure to cooperate fully, and that Commerce was under no obligation to
attempt to verify Canadian Solar or Trina’s submissions. Def. Br. at 10–20.
ii. Discussion
When an interested party “withholds information that has been requested” by Commerce,
Commerce may need to “use the facts otherwise available” to reach a decision. 19 U.S.C. §
1677e(a)(2)(A). Under 19 U.S.C. § 1677e(b) an adverse inference as to what such facts show
may be used only if a party has failed to cooperate to the best of its ability, meaning that a party
has failed to “put forth its maximum effort to provide Commerce with full and complete answers
to all inquiries in an investigation.” Nippon Steel Corp. v. United States, 337 F.3d 1373, 1382
(Fed. Cir. 2003). As the court has previously held in a similar case, if a foreign government fails
to cooperate in a countervailing duty case, Commerce may apply AFA even if the collateral
effect is to “adversely impact a cooperating party.” Archer Daniels Midland Co. v. United
States, 917 F. Supp. 2d 1331, 1342 (CIT 2013). Commerce, however, should “seek to avoid such
impact if relevant information exists elsewhere on the record.” Id.
The court recently issued two opinions regarding the Export Buyer’s Credit Program
Changzhou Trina Solar Energy Co. v. United States, 195 F. Supp. 3d 1334 (CIT 2016)
(“Changzhou I”) and Guizhou Tyre Co. v. United States, Slip Op. 18-140, 2018 WL 5307676
however, appears to have relied only on the potential involvement of third-party banks in
deciding that the certifications of non-use were unverifiable. See I&D Memo at 13–16.
Court No. 17-00198 Page 9
(CIT Oct. 17, 2018) that at least facially seem to conflict. In Changzhou I, the court upheld
Commerce’s use of AFA in determining that respondents used the program. 195 F. Supp. 3d at
1355. The court based its decision on Commerce’s reasonable explanation that an understanding
of how an exporter would be involved in the program was necessary to determine usage and that
the GOC failed to cooperate in providing this information. Id. In contrast, in Guizhou the court
found Commerce’s explanation regarding the use of the EBCP by respondents unavailing. Slip
2018 WL 5307676, at *4. In that case, Commerce found non-use submissions by respondents
unverifiable because the GOC refused to provide documents regarding the functioning of the
EBCP under the GOC’s new regulations. 7 Id. The court found that Commerce failed to show
there was a gap in the record warranting the use of AFA and that Commerce was “conflat[ing]
the program’s operation with its use,” and thus remanded for reconsideration. Id. at *4, *12.
Although both opinions share some factual similarities to this case, neither is fully dispositive
given the record before the court.
In Changzhou I, unlike here, the respondents did not submit customer certifications of
non-use, so that issue was not before the court. See Countervailing Duty Investigation of Certain
Crystalline Silicon Photovoltaic Products From the People’s Republic of China: Final
Affirmative Countervailing Duty Determination, 79 Fed. Reg. 76,962 (Dep’t Commerce Dec. 23,
2014), accompanying Issues and Decision Memorandum at 93 (“Changzhou I I&D Memo”). In
addition to the lack of complete documentation of non-use, in that review Commerce supplied
7
Similarly, given the 2013 changes regarding the involvement of third-party banks to the EBCP,
however, Commerce claims here that the GOC failed to provide information “critical to
understanding how Export Buyer’s Credits flow to/from foreign buyers and the China Ex-Im
Bank.” Prelim. I&D Memo at 31.
Consol. Court No. 17-00198 Page 10
detailed reasoning for why documentation from the GOC was necessary. Changzhou I I&D
Memo at 91–94. Here, Commerce provided reasoning as to why the GOC’s failure to respond
adequately made it impossible for it to understand fully the operation of the EBCP, but it failed
to show why a full understanding of the EBCP’s operation was necessary to verify non-use
certifications.
In Guizhou, as here, Commerce found that the GOC’s refusal to explain if and how third-
party banks were involved in the EBCP made respondent’s claims of non-use unverifiable.
Certain New Pneumatic Off-the-Road Tires From the People's Republic of China: Final Results
of Countervailing Duty Administrative Review; 2014, 82 Fed. Reg. 18,285 (Dep’t Commerce
Apr. 18, 2017) accompanying Issues and Decision Memorandum at 23–24 (“Guizhou I&D
Memo”). In the Guizhou court’s review of that determination, it found that the GOC’s lack of
response was “rendered immaterial by responses from [respondents].” 2018 WL 5307676, at * 3.
The court here does not resolve the materiality issue at this juncture, rather it finds that
Commerce simply failed to provide reasoning sufficient for this court to find that its
determination was supported by substantial evidence. In this case, Commerce claims its ability to
verify the certifications was stymied by a lack of understanding of if and how third party banks
were involved in the distribution of loans. I&D Memo at 13. Commerce, however, did not
explain why the GOC’s failure to explain this program was necessary to assess claims of non-use
and why other information accessible to respondents was insufficient to fill whatever gap was
left by the GOC’s refusal to provide internal bank records. Further, Commerce did not explain
how an adverse inference regarding the operation of the EBCP logically leads to a finding that
respondents used the program. The use of facts available allows Commerce to render
Court No. 17-00198 Page 11
determinations when information is missing and it may use an adverse inference if respondents
fail to cooperate, but is not permitted to skip either of these steps on the way to use of AFA.
Under 19 U.S.C. § 1677e(b) Commerce may use AFA to choose among facts of record,
but the choice must fill in the information that is actually missing. Further, although it is true that
Commerce need not consider information submitted by respondents that cannot be verified,
Commerce must first reasonably show that such information is, in fact, unverifiable. See 19
U.S.C. § 1677m(e); see also Papierfabrik August Koehler SE v. United States, 843 F.3d 1373,
1382–83 (Fed. Cir. 2016) (holding that if the requirements of §1677m(e) are not met, Commerce
need not consider information submitted by an interested party). What type of information
requested from the GOC would have made these claims verifiable? And what information, such
as loan agreements and other relevant documents ostensibly held by Respondents, might have
sufficed to provide Commerce the assurance it needed? Commerce does not explain.
Accordingly, the court remands this matter and instructs Commerce to explain what
information specifically the GOC failed to provide that led it to resort to facts available and the
facts as to which it drew an adverse inference in arriving at the conclusion that Respondents
benefited from the EBCP. Commerce should further explain if and how certifications of non-use
are unverifiable in the absence of the GOC’s cooperation. If Commerce determines that it is able
to verify non-use by not unreasonably onerous means, the court instructs it to do so.
b. Adverse rate selected for Export Buyer’s Credit Program
i. Background
If Commerce continues to find that respondents used the EBCP, and the court sustains
that determination, then the court must assess whether the rate selected for the EBCP is
Consol. Court No. 17-00198 Page 12
supported by substantial evidence. As with several other calculation issues addressed here, in the
interest of judicial and attorney economy the court addresses this issue, which has been briefed
fully. Canadian Solar contests Commerce’s calculation of an adverse rate for the program.
Canadian Solar Br. at 14–17. After finding no program identical to the EBCP in the same
administrative review, Commerce identified a similar program in the same proceeding to use as a
basis for calculating the rate for the EBCP. I&D Memo at 18–19. Commerce calculated a rate of
5.46 percent ad valorem, for the EBCP by utilizing the rate “calculated for company respondent
Lightway Green New Energy Co., Ltd.’s usage of the Preferential Policy Lending to the
Renewable Energy Industry program in the 2012 administrative review of this proceeding.”
Prelim I&D Memo at 32. Commerce explained that the Lightway Green New Energy Co.
Policing Lending Program (“Lightway Program”) was similar because both it and the Export
Buyer’s Credit Program provided access to loans. I&D Memo at 19.
Canadian Solar challenges the use of the Lightway Program rate, arguing that it is not an
appropriately similar program. Canadian Solar Br. at 15. China’s Ex-Im Bank is the
administrator of the EBCP, a program that provides credit to foreign importers of Chinese
products and loans. See I&D Memo at 12–13. Canadian Solar argues the record contains
evidence of a more similar program, the Export Seller’s Credit Program, which provides a more
directly comparable rate than the Lightway Program. Canadian Solar Br. at 15–17. Canadian
Solar argues that the Lightway Program is not a similar program in that, although it calls for
financial institutions to offer loans to renewable energy, these loans are not specifically related to
exports. Canadian Br at 16. They argue that Commerce should have further explained why it
chose the Lightway Program over the Export Seller’s Credit Program. Canadian Solar Br. at 15,
Court No. 17-00198 Page 13
17. The Defendant argues that Commerce acted in accordance with its established practice in
selecting the Lightway Program. Def. Br. at 21–24.
ii. Discussion
Commerce has discretion when calculating the appropriate AFA rate, as neither the
relevant statute nor regulations limit how Commerce must select programs that are “similar,” or
if no similar program exists, one “from a proceeding that the administrating authority considers
reasonable to use.” 19 U.S.C. § 1677e(d)(1); see Solar Americas, Inc. v. United States, 229 F.
Supp. 3d 1362, 1366 (CIT 2017). 8 Commerce has developed a methodology by which to
determine the appropriate AFA rate in accordance with the governing statute. See Solar
Americas, 229 F. Supp. 3d at 1366 (describing Commerce’s five-step hierarchy in selecting an
AFA rate). First, Commerce assesses whether another cooperating company in the same
proceeding used the identical program, and if so, Commerce applies the “highest non-de
minimus rate calculated for a cooperating company for the identical program in the same
proceeding.” Id. If no such figure exists, Commerce applies “the highest non-de minimus rate
calculated for a cooperating company for a similar program in the same proceeding.” Id. If no
8
The section, in relevant part, reads:
“(1) In general. If the administering authority uses an inference that is adverse to the
interests of a party under subsection (b)(1)(A) in selecting among the facts otherwise
available, the administering authority may--
(A) in the case of a countervailing duty proceeding--
(i) use a countervailable subsidy rate applied for the same or similar
program in a countervailing duty proceeding involving the same country;
or
(ii) if there is no same or similar program, use a countervailable subsidy
rate for a subsidy program from a proceeding that the administering
authority considers reasonable to use; . . .” 19 U.S.C. § 1677e(d).
Consol. Court No. 17-00198 Page 14
such figure can be calculated, then Commerce continues to step three, and if necessary, step four
and five until it arrives at the appropriate metric. Id. 9
Here, Commerce was unable to satisfy step one of the methodology as there was no
alternative rate for the EBCP in the Third Administrative Review. See Prelim. I&D Memo at
30–32; I&D Memo at 18–21. Thus, Commerce turned to step two and found a sufficiently
similar program from an earlier administrative review, the Lightway Program. Prelim. I&D
Memo at 31–32; I&D Memo at 19. Commerce predicated this finding of similarity on both the
EBCP’s and the Lightway Program’s distribution of loans. I&D Memo at 19. With this finding,
Commerce applied the rate from the Lightway Program to calculate an AFA rate for the EBCP.
Id. Canadian Solar’s argument that Commerce needed to compare the Lightway Program to
Canadian Solar’s proffered Export Seller’s Credit Program fails. See Canadian Solar Br. at 15.
Under Commerce’s established methodology and consistent with the plain text of the statute,
Commerce selects a similar program, not necessarily the most similar program. See 19 U.S.C. §
1677e(d)(1)(A)(i). Additionally, Canadian Solar argues that Commerce failed to explain why the
Lightway Program was similar. Canadian Solar Br. at 17; but see I&D Memo at 19 (stating that
the Lightway Program was chosen because it, like Export Buyer’s Credit Program, was a loan
program). Although a more detailed description might be helpful, it is not required.
9
“In the absence of [a tier-two rate], Commerce applies the highest non-de minimis rate
calculated for a cooperating company for an identical program in a different CVD proceeding
(i.e., involving a different industry) for the same country. In the absence of such a rate,
Commerce uses the highest non-de minimis rate calculated for a cooperating company for a
similar program in a different proceeding for the same country. Finally, in the absence of such a
rate, Commerce uses the highest rate calculated for any non-company specific program from the
same country that the industry subject to the proceeding could have used.” Solar Americas, 229
F. Supp. 3d at 1366 (internal citations omitted).
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Commerce has broad discretion in determining and applying an AFA rate, so long as it
“reasonably balance[s] the objectives of inducing compliance and determining an accurate rate.”
Solarworld Americas, 229 F. Supp. 3d at 1366. Commerce used its developed methodology to
arrive at the AFA rate of 5.46 percent. The court finds no error in this regard.
II. Provision of Aluminum for LTAR
a. Specificity determination of aluminum program
i. Background
Canadian Solar claims that the provision of aluminum extrusions for less than adequate
remuneration (LTAR) is not properly classified as a specific subsidy. Canadian Solar Br. at 26.
Commerce found, as it did in the second administrative review, that the provision of aluminum
extrusions for less than adequate remuneration was a de facto specific subsidy because the
industries that used aluminum extrusions were “limited in number” and no new information
disturbed that finding. I&D Memo at 22. 10 Both Commerce and Canadian Solar agree that the
six categories of industries that use aluminum extrusions are: “(1) building and construction, (2)
transportation, (3) electrical, (4) machinery and equipment, (5) consumer durables, and (6) other
industries.” I&D Memo at 21; Canadian Solar Br. at 27.
Canadian Solar argues that the named industries listed as using aluminum extrusions are
themselves diverse and also that Commerce failed to inquire as to whether the number of
industries in the “other industries” category would render the subsidy non-specific. Canadian
10
Neither the preliminary nor the final issues and decision memorandum for this administrative
review indicate whether Commerce drew an adverse inference regarding specificity from a
failure of the GOC to fully respond to its questionnaire. Rather, the justification given seems to
rely on unspecified reasoning provided in a previous decision. I&D Memo at 21–22.
Consol. Court No. 17-00198 Page 16
Solar Br. at 26–27. According to Canadian Solar, Commerce was obligated to conduct a more
searching analysis regarding the diversity of these industries as the industries identified are broad
categories that contain numerous sub-industries. Id. at 27–28. SolarWorld argues that the
catchall “other industries” by itself does not mean the subsidy was widely used by numerous
other industries and that Canadian Solar’s relies on outdated case law. SolarWorld’s Response to
Plaintiff’s Rule 56.2 Motion for Judgment upon the Agency Record, Doc. No. 69 at 27–28 (July
20, 2018) (“SolarWorld Resp.”). The Government responds that the information received from
GOC shows that the “recipients of aluminum extrusions (on an industry basis) are limited in
number.” Def. Br. at 25.
ii. Discussion
Commerce is empowered to assess countervailing duties if, after investigating a subsidy,
it finds that the subsidy “1) provides a financial contribution to a person, 2) a benefit is thereby
conferred, and 3) the subsidy is specific.” Bethlehem Steel Corp. v. United States, 223 F. Supp.
2d 1372, 1378 (CIT 2002); see also 19 U.S.C. § 1677(5). No party challenges Commerce’s
determinations regarding financial contribution or benefit conferred. Domestic subsidies are
specific, and thus countervailable, when“[t]he actual recipients of the subsidy, whether
considered on an enterprise or industry basis, are limited in number.” 19 U.S.C. §
1677(5A)(D)(iii)(I). 11 In determining whether a subsidy is provided to a group of enterprises or
11
The relevant statute section on subsidy specificity reads:
“(iii) Where there are reasons to believe that a subsidy may be specific as a matter of fact,
the subsidy is specific if one or more of the following factors exist:
(I) The actual recipients of the subsidy, whether considered on an enterprise
or industry basis, are limited in number.” 19 U.S.C. § 1677(5A)(D)(iii).
Court No. 17-00198 Page 17
industries, Commerce is not required to “determine whether there are shared characteristics
among the enterprises or industries” that receive or are eligible for a subsidy: variety amongst the
industries receiving a given subsidy is not the test for specificity. 19 C.F.R. § 351.502(b). That
being said, Commerce is under an obligation to compare the industries receiving the subsidy to
the industry makeup of the country at issue as a whole. This is a necessary step in the analysis in
order to “avoid the imposition of countervailing duties in situations where, because of the
widespread availability and use of a subsidy, the benefit of the subsidy is spread throughout an
economy.” Uruguay Round Agreements Act, Statement of Administrative Action, H.R.Rep. No.
103-316, vol. 1, at 930–31 (1994), reprinted in 1994 U.S.C.C.A.N. 4040, 4242 (“SAA”). 12 By
way of analogy, if the GOC had instead said that only two sectors used aluminum extrusions –
manufacturing and non-manufacturing – on a shallow level that would seem to satisfy the
requirement that the subsidy be available to only a limited number of industries, but in reality
such a distribution is not specific as those two categories encompass all possible industries.
Thus, although Commerce was under no obligation pursuant to its regulations to compare
the characteristics of the six industries listed by the GOC against one another, Commerce should
have determined whether these six industries made up a significant enough portion of all Chinese
industries to render the subsidy nonspecific despite the use of only six categories to describe
12
See 19 U.S.C. § 3512(d), which reads “[t]he statement of administrative action approved by
the Congress under section 3511(a) of this title shall be regarded as an authoritative expression
by the United States concerning the interpretation and application of the Uruguay Round
Agreements and this Act in any judicial proceeding in which a question arises concerning such
interpretation or application.”
Consol. Court No. 17-00198 Page 18
these industries. 13 The categories mentioned here – building and construction; transportation;
electrical; machinery and equipment; consumer durables; and other industries 14– appear to
represent a large swath of industries that could be further broken down into numerous sub-
industries. 15 Commerce needed to explain how subsidizing these broad industries amounts to a
specific rather than a generally available subsidy. It is nonsensical to simply count the number of
proffered industries, regardless of their composition, in order to determine specificity. Such a
cursory test would allow gamesmanship in specificity determinations by allowing a respondent
to simply recharacterize what is in fact a limited number of industries as numerous industries in
order to avoid such a finding.
13
SolarWorld apparently argues that the six industries Commerce continually references is a
characterization created by China to describe their own industry makeup. See SolarWorld Resp.
at 3. The court notes that these categories instead appear to be used by the U.S.-based
international organization the Aluminum Extruders Council in its analysis of North American
consumption of aluminum extrusions. See Letter from Grunfeld Desiderio Lebowitz Silverman
& Klestadt LLP, to Sec’y Commerce, re: GOC Initial CVD Questionnaire Response re Canadian
Solar, at 45-46, C.R. 38-72, 78-82, 85, P.R. 123-127, Ex. 6 (June 10, 2016). It is unclear from the
record before the court whether the GOC provided these categories as a description of their own
industries or provided them as a comparative for industry usage in the United States.
14
In the preliminary issues and decision memorandum Commerce reasoned that “[a]lthough the
GOC claims its information indicates aluminum extrusions are used in a variety of industries and
sectors across the PRC, the industries within those sectors that actually consume aluminum
extrusions are limited in number.” Prelim I&D at 37. It is unclear from context to what
Commerce is referring with “sectors,” and the Government did not clarify in its briefs or during
oral argument. It is possible, that Commerce was trying to say that these six categories may be
diverse, but the actual users within these six categories are limited, thus resulting in a specific
subsidy. If this is the case, Commerce must further explicate and provide support for such
reasoning.
15
The parties have been unclear about the differences between the record in this case and in
Changzhou Trina Solar Energy Co., Ltd. v. United States, 195 F. Supp. 3d 1334 (CIT 2016).
Thus, it is not clear that it conflicts with the court’s approach here. To the extent it may conflict,
the court declines to follow it at this stage.
Court No. 17-00198 Page 19
The court renders no decision on whether the provision of aluminum in the GOC is, in
fact, a countervailable subsidy, but remands for Commerce to reconsider its methodology in
arriving at this conclusion.
b. Challenge to Commerce’s use of Comtrade and IHS datasets
i. Background
If, on remand, Commerce continues to find that the provision of aluminum amounts to a
countervailable subsidy, it must additionally reconsider the data used to arrive at the appropriate
benchmark. Canadian Solar and Trina challenge Commerce’s decision to average data from IHS
technology (“IHS”) and UN Comtrade (“Comtrade”) to determine the appropriate aluminum
extrusion benchmark.
They contend that whereas IHS data specifically pertains to aluminum frames for solar
modules, the type used by Trina and Canadian Solar, Comtrade data is broader and encompasses
multiple broad Harmonized Tariff Schedule (“HTS”) subheadings at the six-digit level (7604.21,
7604.29, and 7610.10) 16 which covers many products not used by Respondents. Trina Br. at 15;
Canadian Solar Br. at 29–31. Trina and Canadian Solar argue that the annual average figure
provided by IHS provides a more accurate benchmark for the POR because it pertains
specifically to aluminum used in the production of solar panels, and thus accords with
Commerce’s preference for the “narrowest category of products encompassing the input
product.” Trina Br. at 17; see also Canadian Solar at 29–31. Trina further argues that even if
16
“7604.21 (i.e., aluminum alloy hollow profiles), 7604.29 (i.e., aluminum alloy profiles other
than hollow profiles), 7610.10 (i.e., aluminum door, windows and their frames and thresholds for
doors).” Harmonized Tariff Schedule of the United States (2014) (“HTSUS”).
Consol. Court No. 17-00198 Page 20
Commerce’s normal preference for monthly average has merit, there is no way for Commerce to
know whether Comtrade’s monthly data more accurately reflects price fluctuations over time,
because those fluctuations may very well be caused by the irrelevant merchandise within the
HTS subheadings. Trina Br. at 19.
SolarWorld counters that the inclusion of Comtrade data is necessary, given Commerce’s
preference for monthly over annual data in setting benchmark prices. SolarWorld Resp. at 31.
SolarWorld argues that monthly data allows Commerce to match subsidy program pricing with
world benchmark prices more accurately. Id. The Government argues that given the noncritical
flaws in both datasets, averaging them was the appropriate course of action. Def. Br. at 26–31.
ii. Discussion
When goods are provided for LTAR, Commerce determines the amount of the subsidy by
comparing remuneration actually paid with adequate remuneration. See 19 U.S.C. § 1677
(5)(E)(iv). Commerce employs a three-tiered hierarchy to determine the appropriate
remuneration benchmark. In the absence of an undistorted tier one benchmark, e.g., an “actual
transaction [price] in the country in question,” Commerce turns to a tier two benchmark, e.g., a
“world market price” for goods in question. C.F.R. § 351.511(a)(2); see also Essar Steel Ltd. v.
United States, 678 F.3d 1268, 1273 (Fed. Cir. 2012). When there is more than one dataset
representing the world market price, then “the Secretary will average such prices to the extent
practicable, making due allowance for factors affecting comparability.” 19 C.F.R. §
Court No. 17-00198 Page 21
351.511(a)(2)(ii). 17
In this instance, Commerce combined two datasets, IHS Technology and UN Comtrade,
the latter of which uses broad HTS categories. Balancing Commerce’s preference for monthly
data and its desire for data specific to the relevant input, Commerce averaged these two datasets.
But, in doing so, Commerce failed to properly make allowance for “factors affecting
comparability.” See 19 C.F.R. § 351.511(a)(2)(ii).
Commerce prefers monthly data points ostensibly to track potential market fluctuations
over the period of review or investigation, 18 but there is no statutory or regulatory basis for
allowing this preference to overcome vital comparability concerns. This preference does not
allow Commerce to include largely irrelevant data in its average of world market data sets. Put
simply, not all flaws in data are equally problematic. Although some degree of nonspecificity is
tolerable, when a dataset is vastly overinclusive of products not covered by the relevant CVD
order, that flaw is not equivalent to the flaw in otherwise product-specific arising from its annual
average. Here, Commerce made little effort to counter claims that Comtrade data was based on
too broad a product category to provide an accurate world market price, stating only that
Commerce was familiar with the data and that the HTS descriptions were suitable for
constructing a world price for aluminum extrusions. I&D Memo at 23–24. Although Commerce
17
A tier-two benchmark is one that measures “the adequacy of remuneration by comparing the
government price to a world market price where it is reasonable to conclude that such price
would be available to the purchasers in the country in question.” 19 C.F.R. § 351.511(a)(2)(ii).
18
Commerce has not been clear about how it uses information about monthly fluctuations, e.g.,
is there a monthly comparison between purchase price and benchmark price, are aberrant months
rejected, or is synchronization with the period of review the purpose?
Consol. Court No. 17-00198 Page 22
often has to use less than ideal data, here it has the option to use only seemingly product-specific
data.
Thus, the court concludes that Commerce’s decision to average the Comtrade and IHS
datasets without properly considering whether the Comtrade data was too flawed to be probative
of the world market price for the input at issue renders the decision unsupported by substantial
evidence. Accordingly, the court remands this case to Commerce with instructions either to use
solely the IHS dataset in its calculation of the appropriate benchmark or else explain why the
inclusion of the Comtrade data does not produce a fatally inaccurate result.
III. Provision of Solar Glass for LTAR
a. Background
Canadian Solar and Trina similarly challenge Commerce’s benchmark determination
with regard to solar glass. Commerce found the GOC’s solar glass market distorted, and so used
world market indicators to calculate a benchmark for adequate remuneration. I&D Memo at 29.
In its final calculation, Commerce averaged monthly data points from Comtrade 19 with annually-
reported data from IHS. I&D Memo at 29–30. Commerce defends this amalgam arguing that,
although neither set was perfect, neither was so deficient as to merit rejection. Def. Br. at 31–36.
Like the data used in setting the benchmark for aluminum extrusions, the Comtrade data in
question contains monthly data points, but is less specific to solar glass, whereas the IHS data is
an average annual figure, but one specific to solar glass. Id. at 32.
Canadian Solar and Trina contend that Commerce should not include the Comtrade data
19
Comtrade’s dataset is not exclusive to solar glass, but the data used was limited to countries
that produce solar glass. Prelim. I&D Memo at 19.
Court No. 17-00198 Page 23
due to a critical lack of product specificity. Canadian Solar Br. at 21–23; Trina Br. at 22–23.
They argue that Commerce should use only the IHS data given that its specificity to solar glass,
whereas the Comtrade data includes HTS headings that include, but are not limited to, solar
glass. Canadian Solar Br. at 17–19, see also Trina Br. at 20–23. They argue the glass included
in these headings often does not possess the specific characteristics necessary for use in solar
cells. 20
Further, Canadian Solar argues that Comtrade’s monthly benchmarks project a distorted
picture of the solar market, showing price variability unsupported by the record and disputed by
party submissions. 21 See Canadian Solar Br. at 19–20. Canadian Solar acknowledges that
including only Comtrade data from solar glass-producing nations makes the data less-flawed, but
they further note that the Comtrade data does not contain data from certain major solar glass
producing countries, including the United States, which is one of the top three solar glass
producing countries globally. Canadian Solar Br. at 22–23. Finally, Trina contends that
although the record indicates that there is a difference between broadly-defined tempered glass
and the more specific solar glass, Commerce depended on the description of the headings
referencing tempered glass as justification for its position that the headings included solar glass.
Trina Br. at 23.
SolarWorld disagrees. It argues that the inclusion of the Comtrade data was correct given
20
Trina argues that there is a substantial difference between solar glass and tempered glass. For
instance, whereas solar glass has little variability in thickness [[ ]], the glass in the HTS headings
used in Comtrade’s dataset is not similarly restricted to glass falling into narrow thickness
parameters. Trina Br. 22. Further, solar glass requires a low [[ ]] which is not accounted for in
the Comtrade data. Trina Br. at 20.
Consol. Court No. 17-00198 Page 24
Commerce’s established preference for using monthly over annual data. SolarWorld Resp. at
33–34. It asserts that monthly-reported data better accounts for market fluctuations. Id.
Canadian Solar responds that although monthly data points are preferable when available, there
is no statutory requirement mandating that Commerce use monthly rather than annual data and
contend that the use of IHS data is supported by the record. Canadian Solar Reply Brief in
Support of Canadian Solar’s Rule 56.2 Motion for Judgment upon the Agency Record, Doc. No.
80 at 10–11 (Sept. 21, 2018) (“Canadian Solar Reply”); Reply Brief of Trina, Doc. No. 79 at 8–
10 (Sept. 21, 2018) (“Trina Reply”).
b. Discussion
As with the above discussion of the proper datasets for calculating a benchmark for
aluminum extrusions, Commerce similarly calculated its solar glass benchmark by averaging two
tier-two datasets. Also as with the aluminum extrusions data, Commerce did not sufficiently
determine the adequacy of these datasets or explicate their comparability.
Solar glass is a type of flat glass, which in turn is one of the [[ ]] main types of glass on
the global market. Letter on Behalf of Canadian Solar to the Dep’t Commerce re: Benchmark
Submission at Ex. 5 C.R. 101–102 (No. 30, 2016). Flat glass represents about [[ ]]% of the
global glass market, but of that [[ ]]% less than [[ ]]% is solar photovoltaics. Id. Thus the vast
majority of flat glass is not suitable for solar panels, but is used in the production of other
merchandise such as windows, glass doors, windshields, etc. See id. Comtrade data includes
21
See [[ ]]. Canadian Solar Br. at 20.
Court No. 17-00198 Page 25
glass under the six-digit HTS headings 7007.19and 7007.29. 22 Neither of these HTS basket
headings are specific to solar glass, but rather includes many types of safety glass (often a type of
flat glass) unrelated to solar glass. Id. In contrast, the IHS data is specific to solar glass. Prelim.
I&D Memo at 19.
In its brief, Defendant cited the court’s earlier decision in Changzhou Trina Solar Energy
Co., Ltd., v. United States, regarding the averaging of IHS data and Global Trade Atlas (GTA)
data in a prior administrative review to arrive at the proper benchmark for solar glass. Slip. Op.
18-31, 2018 WL 1649629 (CIT Mar. 27, 2018) (“Changzhou II”); Def. Resp. Br. at 28. In that
case, the court upheld Commerce’s decision on remand to average IHS and GTA to arrive at a
benchmark price for solar glass for reasons similar to those given in this case. See Changzhou II,
2018 WL 1649629 at *7. The court notes that plaintiffs challenge the use of the Comtrade data in
this case, but there was no challenge to the use of GTA data in the previous case, and thus the
court had neither the appropriate record nor any reason to inspect the adequacy of the GTA data.
Id. at *6. Thus, the court finds the previous decision unhelpful.
Finally, the court finds Commerce’s reliance on potential price fluctuations in the solar
glass industry as a reason for including the Comtrade data unpersuasive. The only indication on
the record before the court showing price fluctuations in solar glass is from the Comtrade data
itself. In contrast, submissions by respondents during the administrative review show minimal
solar glass price fluctuations. Canadian Solar Br. at 19–20. Commerce did not inquire into
22
Heading 7007 contains “Safety glass, consisting of toughened (tempered) or laminated glass.”
7007.19 contains “toughened (tempered) safety glass: other.” 7007.29 contains “[l]aminated
safety glass: other.” The other in both cases referring to “[of] size and shape suitable for
incorporation in vehicles, aircraft, spacecraft or vessels.” HTSUS (2014).
Consol. Court No. 17-00198 Page 26
whether the fluctuations in the Comtrade data were due to solar glass rather than other
merchandise contained in the HTS headings. Without answering that threshold question, the
court cannot be certain that the addition of the Comtrade data does not create the appearance of
fluctuations in the solar glass market were none actually exist. Accordingly, the court cannot
assess whether the inclusion of the Comtrade data makes the resulting benchmark more or less
reliable.
Although averaging datasets is appropriate in certain circumstances, when one dataset is
far more specific to the product at issue, that data may be more probative even if it is based on a
yearly average rather than a monthly one. See 19 C.F.R. § 351.511(a)(2)(ii) (requiring the
department to take into account “factors affecting comparability”). As with the datasets used to
calculate the aluminum extrusions rate, Commerce failed to adequately evaluate and explain the
relative adequacy and comparability of both datasets. 23 Although Commerce may prefer to
employ monthly data in its analysis, this cannot supersede regulatory considerations requiring
the use of adequate data Here, Commerce failed to meaningfully assess the reliability of the
Comtrade data and included it despite indications that it is overinclusive in regards to the types
of glass included in the data, underinclusive in failing to include solar glass-producing countries,
and by failing to assess whether the monthly fluctuations were due to price variability of solar
glass or merely related to other merchandise contained in the HTS headings at issue.
In finding the Comtrade data to be a sufficient world market price metric without
adequate evaluation, Commerce made a decision unsupported by substantial evidence or
23
As with aluminum extrusions, it is unclear how Commerce utilizes monthly fluctuation data.
Court No. 17-00198 Page 27
otherwise not in accordance with law. On remand, Commerce is instructed to use the IHS data
alone in constructing a benchmark for the world market price for solar glass and otherwise
address the court’s concerns as to the Comtrade data and explain why its inclusion is appropriate.
IV. Provision of Polysilicon for LTAR
a. Background
In its original investigation, Commerce determined that the provision of polysilicon at LTAR
in the PRC was a countervailable subsidy based on AFA. Prelim. I&D Memo at 33–35.
Commerce determined that a benefit was being conferred based on the provision of polysilicon
for LTAR, and thus sought to determine adequate remuneration in order to assess the appropriate
countervailing duty. 24 Id. at 34, I&D Memo at 31.
It is Commerce’s practice to determine remuneration by comparing the government price
to a “market-determined price for the good or service resulting from actual transactions in the
country in question,” which it refers to as a tier-one metric. See 19 C.F.R. § 351.511(a)(2)(i). 25
24
In this review, the GOC indicated that certain producers of solar grade polysilicon were
majority-owned by the government, so Commerce found that they “constitute[d] ‘authorities’
within the meaning of section 771(5)(B) of the Act” and when the producers were foreign-owned
that evidence on the record showed that these produces were “vested with governmental
authority.” Prelim. I&D Memo at 33. The finding that the producers were “authorities” within
the meaning of the Act was in part based on AFA due to the GOC’s failure to respond adequately
to numerous questions. See id. at 22–25 (detailing findings based on AFA). Commerce found
that a “benefit [was] being conferred because the polysilicon [was] being provided for LTAR.”
Id. at 34. Because the GOC refused to provide information on the industries consuming
polysilicon, Commerce relied on the GOC’s statement from a prior review in determining that
the subsidy was “limited to specific industries within the meaning of section 771(5A)(D)(iii) of
the Act, namely, the solar and semiconductor industries.” Id.
25
Tier-one metrics “could include prices stemming from actual transactions between private
parties, actual imports, or, in certain circumstances, actual sales from competitively run
government auctions.” 19 C.F.R. § 351.511(a)(2)(i); See I&D Memo at 31.
Consol. Court No. 17-00198 Page 28
When no such price is available, or when there is reason to conclude that actual transactions are
distorted, then Commerce resorts to its tier-two metric and determines adequate remuneration by
comparing the government price to a world market price if it is reasonable to assume purchasers
in the relevant country would be able to access that price. See 19 C.F.R. § 351.511(a)(2)(ii);
Countervailing Duties: Final Rule 63 Fed. Reg. 65,348, 65,377 (Dep’t Commerce Nov. 25, 2018)
(“Preamble”). Because Commerce found that the PRC’s involvement in the polysilicon market
distorted the domestic prices, Commerce resorted to tier-two world market price data in order to
determine the appropriate polysilicon subsidy benchmark. 26 I&D Memo at 31; See 19 C.F.R. §
351.511(a)(2). Commerce did not explain how the GOC’s market interference would result in
import distortion.
Canadian Solar challenges this determination, arguing that because all of its polysilicon
purchases were imported from market-economy suppliers outside the PRC, rather than
domestically-purchased, they would not be distorted by the GOC’s market interference.
Canadian Solar Br. at 41–42. Canadian Solar thus contends that Commerce should have used
Canadian Solar’s purchases as a first-tier metric. Id. at 42. SolarWorld objects, arguing that
although these purchases were imports, the “third-country suppliers would be forced to lower
prices in order to compete with the artificially low prices in China.” SolarWorld Resp. at 44.
The Defendant responds that after finding that the Chinese market was distorted, it acted within
its discretion in rejecting the imports as tier-one evidence and resorting to tier-two. Def. Br. at
37–38.
26
Commerce averaged the world market solar grade polysilicon prices from Bloomberg, Energy
Trend, Greentech Media, and IHS. I&D Memo at 31.
Court No. 17-00198 Page 29
b. Discussion
As mentioned above, Commerce’s determination that the polysilicon program was
countervailable was based on the use of AFA. Prelim. I&D Memo at 18. As indicated
previously, when a party refuses to cooperate and withholds requested information necessary to a
determination, Commerce may need to rely on “facts otherwise available” in making a
determination. 19 U.S.C. § 1677e(a)(2). Although under 19 U.S.C. § 1677e(b) Commerce may,
under certain circumstances, draw an adverse inference as to facts affecting a cooperating party,
it should attempt to avoid doing so when adequate information exists elsewhere on the record
that would avoid this collateral effect. Archer Daniels, 917 F. Supp. 2d 1331 at 1342; see also
Fine Furniture (Shanghai) Ltd. v. United States, 865 F. Supp. 2d 1254, 1262 (CIT 2012) (holding
that “[w]here the respondents have placed evidence on the record consistent with the
Department’s regulations for calculating benchmarks . . . Commerce would be expected to
consider such evidence.”). The court in Fine Furniture also found that an “alternative benchmark
meeting such criteria” that did not “adversely affect a cooperative party . . . would be superior to
one which does adversely affect a cooperative party.” 865 F. Supp at 1262. 27 This policy helps
ensure that non-government respondents continue to cooperate in administrative reviews and
gives Commerce more opportunities to collect data that may best reflect a rate set in accordance
with market principles.
Here, Canadian Solar did not take issue with Commerce’s calculation of the world market
price, but rather they argue that Commerce should not have resorted to this tier-two metric in the
27
The non-government respondents in that case did not place on the record any alternative
benchmarks consistent with 19 C.F.R. § 351.511(a)(2). See Fine Furniture, 865 F. Supp. at 1262.
Consol. Court No. 17-00198 Page 30
first place. Nothing in the record before the court indicates that Chinese manipulation of
domestic transactions had any effect on arms-length import prices, and without such a
determination, it is impossible to assess whether Commerce correctly resorted to a tier-two
benchmark.
Rather than address Canadian Solar’s submissions, which Canadian Solar claims show
that all polysilicon purchases involved “arms-length import transactions with market economy
suppliers,” Commerce dismissed the evidence without consideration, stating simply that
Commerce had already found actual transactions in China distorted. Canadian Solar Br. at 42;
I&D Memo at 31. This is circular. Commerce’s determination that the actual transactions were
distorted presupposed the appropriateness of applying a subsidy rate to these cooperating parties
derived from application of AFA in finding there was a subsidy program. Simply stating that the
market was distorted fails to give cooperating parties a meaningful chance to rebut that they
benefitted from any subsidy resulting in market distortion. Commerce should have considered
Canadian Solar’s proffered evidence and either accepted it as a tier-one metric or explained how
these imports may have been distorted by GOC interference in the market. Only if the latter
occurred would it be appropriate to resort to a tier-two metric. In sum, Commerce must first
explain why Canadian Solar’s submission, a potential tier-one benchmark, is not usable. Such an
explanation should not be based entirely on the adverse inference used to determine that the
GOC’s influence in polysilicon distorted the market. Although SolarWorld’s claim regarding
import price depression in order for importers to compete in the PRC’s national market may
certainly be the case, without any such determination on the record, or even sufficient
information about polysilicon’s fungibility or the dynamics of the market, the court cannot
Court No. 17-00198 Page 31
accept it.
Accordingly, with respect to Commerce’s decision to resort to a tier-two benchmark with
regards to polysilicon, the court finds that Commerce’s decision was unsupported by substantial
evidence and remands this issue. On remand Commerce should either use Canadian Solar’s
import data as a tier-one benchmark or else explain how the GOC’s purported interference with
the polysilicon market would distort arms-length import transactions in a way that makes this
data unreliable.
V. Inclusion of International Freight Charges
a. Use in calculating polysilicon, aluminum, and solar glass benchmarks
i. Background
In calculating the appropriate benchmark Commerce added international freight charges
to the calculations for polysilicon, aluminum, and solar glass. I&D Memo at 33. Canadian Solar
argues that [[ ]] Commerce should not include international freight charges. Canadian Solar Br.
at 32–34. Commerce rejected this argument in its final determination. See I&D Memo at 33.
SolarWorld and the Government contend that the statute only requires that the benchmark be
adjusted based on market conditions and does not concern the character of purchases by specific
respondents during the period of review. SolarWorld Resp. at 34–36; Def. Br. at 38–39.
ii. Discussion
The statute at issue requires Commerce to determine a world market price based on
“prevailing market conditions.” 19 U.S.C. § 1677(5)(E). 28 Commerce’s regulation states that in
28
The section reads, in relevant part:
“the adequacy of remuneration shall be determined in relation to prevailing market
Consol. Court No. 17-00198 Page 32
assessing the adequacy of remuneration with a tier-one or tier-two metric, 29 Commerce is
required to “adjust the comparison price to reflect the price that a firm actually paid or would pay
if it imported the product.” 19 C.F.R. § 351.511(a)(2)(iv). The regulation explicitly includes
transportation as an input in calculating prevailing market conditions and further assumes for its
purposes that a firm imports the product at issue. Id.; see also Creswell Trading Co. v.
Allegheny Founding Co., 141 F.3d 1471, 1478 (Fed. Cir. 1998) (finding that a world market
price must include the cost of shipping). This regulation does not require Commerce to base its
decision on the purchasing decisions of the parties before it in a given proceeding, but rather
requires that Commerce calculate the market conditions based on a party’s hypothetically
importing a given product. See Beijing Tianhai Industry Co., Ltd. v. United States, 52 F. Supp.
3d 1351, 1374 (CIT 2015) (holding that a reference to a “firm” in 19 C.F.R. § 351.511(a)(2)(iv)
does not refer to the respondent but to “a hypothetical firm located in the [country at issue].”)
Canadian Solar mistakenly asserts that Commerce’s calculations should be based on the
specific circumstances of the Respondents. 30 As the court has indicated, however, Commerce
has determined that benchmark calculations are assessed based on a hypothetical importer
making a market-price purchase, not the specific parties in a proceeding. See Beijing, 52 F.
conditions for the good or service being provided or the goods being purchased in
the country which is subject to the investigation or review. Prevailing market
conditions include price, quality, availability, marketability, transportation, and
other conditions of purchase or sale.” 19 U.S.C. § 1677(5)(E).
29
As noted earlier, Commerce has devised a three-tiered hierarchy in determining adequate
remuneration. See 19 C.F.R. 351.511(a)(2)(i)-(iii).
30
The court does not evaluate whether Canadian Solar actually imported the goods at issue, but
will assume so for the sake of argument.
Court No. 17-00198 Page 33
Supp. 3d at 1374. Basing calculations on a hypothetical importer rather than the respondent in a
given administrative review is not a plainly erroneous interpretation of 19 C.F.R. §
351.511(a)(2)(iv). See Auer v. Robbins, 519 U.S. 452, 461 (1997) (finding that an agency’s
interpretation of its own regulations controlling unless plainly erroneous or inconsistent with the
regulation). Commerce found, freight charges would be paid by an importer of aluminum, solar
glass, and polysilicon. See Prelim. I&D Memo at 34, 36, 37. Commerce was thus required to
add international freight charges in order to calculate an accurate benchmark for the products in
question. See Essar Steel Ltd. v. United States, 678 F.3d 1268, 1274 (Fed. Cir. 2012) (finding
that adding freight to the world market price was required by 19 U.S.C. § 1677(5)(E) as a
prevailing market condition). Accordingly, Commerce’s inclusion of international freight
charges in its benchmark calculations is supported by substantial evidence and is in accordance
with law.
b. Calculation of International Freight Charges for Benchmarking
i. Background
In determining the proper freight charge to be added for each benchmark calculation,
Commerce averaged two data sets from Maersk and Xenata. I&D Memo at 33. The Xenata data
was calculated based on actual prices while the Maersk data was based on price quotes. Id. at
34. Canadian Solar argues that because the Maersk Data is based on price quotes rather than
finalized contracts, this data should be excluded from the calculation. Canadian Solar Br. at 35–
36. Further, Canadian Solar contends that the use of such data is not in accordance with
Commerce’s own regulations. Id.
ii. Discussion
Consol. Court No. 17-00198 Page 34
Under 19 C.F.R. § 351.511(a)(2), Commerce is required to calculate “the price that a firm
actually paid or would pay if it imported” the product at issue. In making this calculation, this
court has previously allowed Maersk’s datasets based on price quotes for international freight
charges rather than finalized contracts. See TMK IPSCO v. United States, 222 F. Supp. 3d 1306,
1320–21 (CIT 2017) (finding that using Maersk’s estimates was reasonable). Commerce’s
regulations require that “[w]here there is more than one commercially available world market
price, [Commerce] will average such prices to the extent practicable.” 19 C.F.R. 351.11(a)(2)(ii).
Commerce did not err in averaging the two datasets in determining the proper
international freight benchmark. The regulation requires only that the price calculated reflect
what a firm paid or would pay. This determination can properly be made on generally-available
price quotes, so long as the source of those price quotes is a reputable source. Given Maersk’s
prominent position in the shipping market, Commerce properly considered the Maersk data to be
a reliable world market price and averaged it with the Xenata data. As long as Commerce
adequately justified why it chose to average the given datasets, as it did here, a set will not be
excluded simply because it is based on a price estimate rather than completed contracts. See I&D
Memo at 33–34. The benchmark calculation is sustained.
VI. Use of Value-Added Tax in calculating LTAR
i. Background
In its final determination, Commerce included value-added tax (VAT) in determining the
appropriate benchmark prices. I&D Memo at 38–39. Canadian Solar claims that the addition of
VAT is not an allowable adjustment under the regulation. Canadian Solar Br. at 36–38. They
claim that VAT cannot be properly categorized as a delivery charge or import duty, but is rather
Court No. 17-00198 Page 35
an indirect tax, the inclusion of which inflates the apparent benefit received. Id. at 37; see 19
C.F.R. § 351.102(b)(28). In addition, Canadian Solar argues that because VAT is later recouped,
it should not be included. Canadian Solar Br. at 38.
SolarWorld counters that failing to include the VAT would distort the benefit calculated.
SolarWorld Resp. at 39–40. The Government argues that the mandate of the statute is to
calculate what an importer would pay at the time of import–which includes VAT–and that in
calculating this figure, Commerce does not account for potential reimbursement after import.
Def. Br. at 42–43.
ii. Discussion
Under the relevant regulation, Commerce adjusts benchmark prices to include delivery
charges and import duties that an importer would pay in order to arrive at the “delivered price.”
See 19 C.F.R. § 351.511(a)(2)(iv). The court has previously found the inclusion of VAT in this
calculation appropriate. See Beijing, 52 F. Supp. 3d at 1372–1375 (holding that the inclusion of
VAT in a tier-two benchmark was correct). The relevant statute says that when determining the
adequacy of remuneration Commerce should take into account market conditions including
“price, quality, availability, marketability, transportation, and other conditions of purchase or
sale.” 19 U.S.C. § 1677(5)(E).
Here, Canadian Solar’s contention that the inclusion of VAT is not allowable under the
regulation fails. The relevant regulation states that the benchmark should be adjusted to reflect
the “delivered price” meaning the “price that a firm actually paid or would pay if it imported the
Consol. Court No. 17-00198 Page 36
product.” 19 C.F.R. § 351.511(a)(2)(iv). 31 Commerce determined that VAT would be paid in
this situation and Canadian Solar has offered no evidence showing that to be incorrect. It is
immaterial that the regulations may classify VAT as an indirect tax; the regulation does not say
that the delivered price only includes delivery charges and import duties, just that it does include
these figures. VAT is properly classified as a market condition under the statute, and is thus may
be included in calculating the benchmark for adequate remuneration. See 19 U.S.C. §
1677(5)(E). Therefore, Commerce’s addition of VAT to the benchmark was supported by
substantial evidence and otherwise in accordance with law.
VII. Electricity Subsidy
a. Background
After finding that the GOC failed to fully cooperate in responding to questions regarding
the alleged provision of electricity for LTAR, Commerce applied AFA to determine that there
was a specific subsidy and subsequently to calculate the benefit conferred. 32 I&D Memo at 40–
41; Prelim. I&D Memo at 27–28. When a party fails to respond to “the best of its ability” with
31
The full text of this provision reads:
“Use of delivered prices. In measuring adequate remuneration under paragraph (a)(2)(i)
or (a)(2)(ii) of this section, the Secretary will adjust the comparison price to reflect the
price that a firma actually paid or would pay if it imported the product. This adjustment
will include delivery charges and import duties.” 19 C.F.R. § 351.511(a)(2)(iv).
32
Commerce found that the GOC failed to provide satisfactory responses to questions necessary
to ascertain whether the electricity schedules were calculated based on market principles. I&D
Memo at 41. Specifically, the GOC did not provide full responses to questions regarding “(1)
how increases in the cost elements in the price proposals led to retail price increases for
electricity; (2) how increases in labor costs, capital expenses, and transmission and distribution
costs are factored into the price proposals for increases in electricity rates; and (3) how the cost
element increases in the price proposals and the final price increases were allocated across the
province and across tariff end-user categories.” Prelim. I&D Memo at 27–28.
Court No. 17-00198 Page 37
reasonable requests for information, Commerce may apply AFA in order to prevent that party
from benefitting from its non-cooperation and to encourage future participation. See Nippon
Steel Corp., 337 F.3d 1373 at 1382; Fine Furniture (Shanghai) Ltd. v. United States, 748 F.3d
1365, 1373 (Fed. Cir. 2014). Commerce relied on AFA in finding that there was a subsidy, that
the subsidy was specific, and in calculating the benchmark. I&D Memo 40–42. Commerce
selected the highest rate schedule on record for each reported category and used those rates to set
a benchmark. See I&D Memo at 41; Prelim. I&D Memo at 28. Commerce states that this
calculation is reasonable because without information on how electrical rates are determined, it is
plausible that a respondent would bear the highest rate regardless of a plant’s location. I&D
Memo at 41; see also Def. Br. at 44, 46.
Canadian Solar argues that Commerce failed to adequately determine that the electricity
subsidy was specific. Canadian Solar Br. at 39–41. According to Canadian Solar, it could
qualify only as a domestic subsidy under 19 U.S.C. § 1677(5A)(D) because electricity cannot be
imported or exported. 33 Id. at 40. In its reply brief, Canadian Solar further argues that
Commerce failed to make a specificity determination at all and simply concluded that the
provision of electricity was countervailable without an explanation. Canadian Solar Reply at 16–
19. Finally, Canadian Solar and Trina disagree with Commerce’s application of the highest rate
from six different provinces in China given that a particular factory cannot exist in more than one
33
Several countries around the world, including China, export electricity. See, e.g., The World
Factbook: Country Comparison Electricity-Exports, Central Intelligence Agency at
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2234rank.html (listing
countries by the amount of electricity they exported in 2015). But Commerce seems to be
addressing a domestic subsidy here.
Consol. Court No. 17-00198 Page 38
location. Canadian Solar Br. at 41; Trina Br. at 26. Canadian Solar argues that Commerce
failed to cite anything supporting the notion that the subsidy was geographically specific.
Canadian Solar Br. at 40. 34 Trina further argues that the GOC supplied enough information to
prove that electricity pricing varies by province. Trina Br. at 24. Trina contends that the record
proves that plants at issue would not have been subjected to the electricity rates of provinces in
which they were not located. Id. Trina presents various ways in which Commerce could have
calculated the rate while still applying AFA. Trina Br. at 27.
i. Discussion
The court has upheld the application of AFA in determining that a given subsidy was
specific when a party has failed to cooperate. See RZBC Grp. Shareholding Co. Ltd. v. United
States, 100 F. Supp. 3d 1288, 1296–97 (CIT 2015) (sustaining an application of AFA to
determine that a calcium carbonate subsidy was specific). In previous cases involving electricity
subsides from China, the court has found an adverse inference appropriate when a party did not
provide enough information to determine whether the rate was set according to market
principles. See Fine Furniture, 865 F. Supp. 2d at 1262–63.
In this instance, Commerce characterized the GOC’s refusal “to answer questions related
to regional electrical differences, including differences between industries” as preventing it from
determining from direct evidence whether the subsidy was specific. I&D Memo at 41. It
decided solely on this failure to answer some questions that the subsidy was specific. Commerce,
however, failed to explain the particular facts as to which it was it was drawing an adverse
inference and how that analysis subsequently results in a finding of specificity under one of the
34
In fact, Commerce did not make a finding of geographic specificity. See I&D Memo at 41.
Court No. 17-00198 Page 39
criteria listed in 19 U.S.C. § 1677(5A).
AFA is not a magic phrase that permits Commerce to skip an analysis of the record. Here,
the Government states that the GOC failed to adequately respond with information necessary for
Commerce to understand whether the electricity prices were set in accordance with market
principles. In response to Commerce’s questions, the PRC supplied numerous documents
detailing the provision of electricity in China. See Conf. Joint App’x 1 at 35–520. Rather than
explain what information was missing, or how these submissions were deficient, Commerce
makes the conclusory statement that the GOC failed to comply and thus Commerce can rightly
determine that there is a subsidy, that it confers a benefit, and that it is specific such that the
subsidy is countervailable. Prelim. I&D Memo at 27–28. Without combing through the
submissions and guessing as to why Commerce found these submissions inadequate, the court is
unable to ascertain how Commerce made its decision. The record is simply unclear.
Although Commerce does mention that the electricity program was found countervailable
in an earlier administrative review, that earlier decision based on a different record does not
clarify how Commerce found for this review period that the provision of electricity continued to
provide a financial contribution, whether the subsidy conferred a benefit, and, most relevant
here, whether this provision was specific within the meaning of the statute. See 19 U.S.C. §
1677(5)(B); see also Albemarle Corp. & Subsidiaries v. United States, 821 F.3d 1345, 1356
(2016) (stating that Commerce must “base its decisions on the record of the administrative
proceeding before it in each review”). Although the Court of Appeals for the Federal Circuit’s
decision in Albemarle had to do with Commerce’s duty to recalculate dumping margins in each
administrative review, except in certain limited circumstances, the principle underlying that
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decision holds true here. The purpose of administrative reviews is to reassess earlier
determinations in the light of data relevant to the period of review. See id. at 1356–57. If
Commerce simply relies on findings from an earlier administrative review in reaching a decision
in a current review, it abdicates its responsibility and undermines the central purpose of periodic
reviews.
This is not to say that Commerce cannot reference the reasoning of a previous
administrative review. But Commerce must give respondents a meaningful opportunity to
dispute earlier findings and offer evidence of changes. If respondents fail to do so, then
Commerce might state that no new evidence merits a reconsideration of a decision made in a
previous administrative review, but Commerce must at the very least explain why a decision
made in an earlier review should control.
Simply stating that the GOC did not fully comply is insufficient, Commerce must
actually engage in an analysis of the information on the record and explain how adverse
inferences lead to the conclusion that the provision of electricity in China is a countervailable
subsidy. Otherwise stated, Commerce must connect the dots: how does the GOC’s partial
response–or failure to respond fully–reasonably lead to a finding of a specific subsidy even with
use of AFA?
If, on remand, Commerce properly concludes that the provision of electricity in the PRC
amounts to a countervailable subsidy, Commerce’s benchmark determination based on record
evidence with appropriate adverse inferences is consistent with its regulations for calculating
benchmarks. See 19 C.F.R. § 351.511(a)(2). The GOC refused to provide certain details
regarding variation of provincial electricity rates and whether these rates were calculated based
Court No. 17-00198 Page 41
on market principles. See I&D Memo at 41. Accordingly, Commerce can apply an adverse
inference to the GOC’s electricity rate submissions and select the highest rates for each electrical
category and use those to set a benchmark. See 19 U.S.C. § 1677e(b); 19 C.F.R. §
351.511(a)(2)(iii); Fine Furniture, 865 F. Supp. 2d at 1260–1262 (upholding Commerce’s
decision to set the benchmark rate for electricity equal to the highest rate reported in the
provincial price schedules submitted by the GOC when Commerce was unable to determine
whether the prices were set in accordance with market principles). Commerce’s goal in setting a
benchmark rate is to best approximate the market rate of electricity, not to choose the rate
respondents were most likely to pay in an electricity market Commerce argues is tainted by the
GOC’s interference.
Finally, although Trina provided potential alternative modes of calculating the
benchmark, it has not shown that these calculation methods result in a better estimate of the
market rate for electricity. It is not this court’s place to substitute its judgment for that of
Commerce by selecting a different method of calculation where Commerce has acted within its
lawful discretion and made a reasonable decision. See Inland Steel Indus., Inc. v. United States,
188 F.3d 1349, 1360–61 (Fed. Cir. 1999). In sum, assuming a countervailable subsidy exists,
Commerce acted in accordance with the law in using the highest of all provincial rates on the
record to calculate the benchmark.
Accordingly, the issue regarding the provision of electricity is remanded for Commerce
to explain how it arrived at its conclusion that such provision was a countervailable subsidy.
Commerce should cite specific information on the record, noting any allowable adverse
inferences, in making its decision.
Consol. Court No. 17-00198 Page 42
VIII. Golden Sun Demonstration Program
i. Background
During the original investigation, Commerce found the Golden Sun Demonstration
Program (“GSDP”) to be countervailable. See Crystalline Silicon Photovoltaic Cells, Whether or
Not Assembled into Modules, From the People's Republic of China: Final Affirmative
Countervailing Duty Determination and Final Affirmative Critical Circumstances Determination,
77 Fed. Reg. 63,788 (October 17, 2012) and accompanying issues and decision memorandum at
10–11 (“I&D Memo 2012”). The GSDP was created in 2009 to assist in the construction of
photovoltaic electricity-generation projects. See Prelim. I&D at 43. In its final determination,
Commerce found no new information warranting a reexamination of the program and concluded
that the subsidy was untied and attributable to Canadian Solar’s total sales. I&D Memo at 47.
The Government argues that it must only look at the grant when it was bestowed and need not
inquire as to how the grant was used specifically. Def. Br. at 48–50.
Canadian Solar contends that GSDP was meant to subsidize the generation of electricity
and not the production of solar cells. Canadian Solar Br. at 44. Although Canadian Solar admits
that it received GSDP funds, it asserts that Commerce has mischaracterized the program’s
purpose as providing assistance in the production of solar cells. Id. at 43–45. Canadian Solar
contends that at the time of bestowal, the subsidy could only be properly attributed to power
generation operations and thus Commerce improperly assessed countervailing duties on the
production of solar cells. Canadian Solar Br. at 43–45. SolarWorld contends that it is unclear
from the record whether the grant was intended for electricity production or solar cell
production. SolarWorld Resp. at 45–46.
Court No. 17-00198 Page 43
ii. Discussion
In the 2012 Final Determination from the initial investigation, Commerce found that the
Golden Sun program subsidized “solar-powered projects.” I&D Memo 2012 at 12 (October 17,
2012). Based on submissions by the GOC, in its preliminary determination Commerce found
that the program supported:
(1) The use of large-scale mining, commercial enterprises, and public welfare institutions
to construct the user's side of the electrical grid for photovoltaic power generation
demonstration projects; (2) increasing the power supply capacity in remote locations; and
(3) construction of large-scale grid-connected photovoltaic power generation
demonstration projects in solar energy rich regions.” Crystalline Silicon Photovoltaic
Cells, Whether or Not Assembled Into Modules, From the People's Republic of China:
Preliminary Affirmative Countervailing Duty Determination C-570-980 POI 01/01/2010-
12/31/2010 at 15–16 (Mar. 26, 2012) (“Prelim. I&D Memo 2012”)
Based on this information, Commerce determined that grants under this program constitute a
subsidy of enterprises “involved in the construction of solar-powered projects.” Prelim. I&D
Memo 2012 at 16.
Commerce’s regulations mandate that “[i]f a subsidy is tied to the production or sale of a
particular product; the Secretary will attribute the subsidy only to that product.” 19 C.F.R. §
351.525(b)(5)(i). When a subsidy is not tied to a specific product, however, it is Commerce’s
practice to attribute the benefits of a subsidy based on the stated purpose at the time of
bestowal, 35 as untied subsidies are attributed to all products sold because they benefit all
production. Preamble, 63 Fed. Reg. at 65,400 (“the current benefit of an untied subsidy will be
attributed to the firm’s total sales.”)
35
“[W]e analyze the purpose of the subsidy based on information available at the time of
bestowal.” Preamble, 63 Fed. Reg. at 65,403.
Consol. Court No. 17-00198 Page 44
Canadian Solar argues that the language of the program description is not specific to the
production of solar cells, but is for energy production broadly. While this may be true,
Commerce reasonably understands this program to include the subsidization of the production of
solar cells, despite the inference needed to reach this conclusion. It is reasonable to assume that
creating photovoltaic power generation necessitates the production of solar cells as a component
of this endeavor. Although Canadian Solar may not use the funds received through this program
specifically in the production of solar cells, Commerce need only look at the purpose of the
subsidy at the time it is bestowed and not exactly how it is used by companies. Therefore,
Commerce’s decision is supported by substantial evidence and in accordance with law.
CONCLUSION
For the foregoing reasons, the court remands Commerce’s challenged determinations as
regards to its determination on the Export Buyer’s Credit Program, the inclusion of Comtrade
data in calculating the world market rate for aluminum extrusions and solar glass, Commerce’s
decision to revert to a tier-two benchmark in determining the price for polysilicon without
considering Respondent’s proffered evidence, and the finding that provision of electricity
constitutes a specific and thus countervailable subsidy. All other determinations are sustained.
The court remands for proceedings consistent with this opinion. Remand results should be filed
by January 29, 2019. Objections are due February 28, 2019 and Responses to Objections are due
March 15, 2019.
__V-DQH$5HVWDQL_
Jane A. Restani, Judge
Dated: November 30, 2018
New York, New York