The location of the processing of silicon wafers into solar cells determines

Following the EU's implementation of anti-dumping duties in 2013 on solar panels originating from China and the more recent decline in solar panel prices, Chinese manufacturers have been relocating production outside China.

In this instance, a Chinese company temporarily imported solar panels into Thailand, claiming Thai origin. It was asserted that the assembly of solar cells into solar panels occurred in Thailand; however, there was no evidence supporting this claim.

Upon importation of the solar panels with the reported Thai origin, Dutch Customs Authorities determined the true origin to be China, based on an OLAF EU fraud report. A Dutch court has now confirmed these findings, noting that even if simple assembly occurred in Thailand, it does not suffice to change the origin. The court specifically ruled, in accordance with the Court of Justice of the European Union's Renesola decision, that the origin of solar panels is determined by the location where the silicon wafers are processed into solar cells, which through the OLAF report has been found to be in China.

Key takeaway

In the context of increasing anti-dumping and customs duties worldwide, this case illustrates how companies may attempt to evade these duties (sometimes fraudulently). Chinese firms are increasingly relocating parts of their manufacturing to Southeast Asia to claim local origin. It is crucial to verify the true origin of these products by examining their supply chain, as failure to do so may result in substantial additional duties, as demonstrated in this case.

Reference

ECLI:NL:RBNHO:2024:13423, Rechtbank Noord-Holland, ABW - 22 _ 3547