USA imposes 9.13% tariff on solar panels, the second highest in ASEAN.

To protect local industry players, the US Department of Commerce imposes different levels of tariffs on Southeast Asian solar panels, with Malaysia as an example, those companies not specified have a preliminary rate of 9.13%, the second highest in Southeast Asia.

Earlier, a preliminary investigation found these products benefited from illegal government subsidies, and the introduction of this policy signifies an initial victory for domestic US solar panel manufacturers.

According to Bloomberg, local companies are requesting the US government to impose tariffs and claim that other countries benefit from foreign subsidy mechanisms, selling at prices below production costs.

It is noteworthy that this case is the latest action by American manufacturers against overseas competitors. As early as 12 years ago, the United States imposed similar tariffs on Chinese solar cells and components.

At that time, the response or contingency measures of Chinese manufacturers were to establish operations in other Asian countries unaffected by tariffs.

According to the U.S. Department of Commerce, the preliminary normal tariffs for unspecified Thai companies are 23.06%; Malaysia 9.13%; Cambodia 8.25%; Vietnam 2.85%.

In terms of specific tariff rates for designated companies, Hanwha Q Cells Malaysia Private Limited (Hanwha Q Cells) has an import tax rate of 14.72%; JinkoSolar Holding Malaysia Entity imports taxed at 3.47%; Trina Solar Science & Technology (Thailand) tax rate is 0.14%; JA Solar Technology Vietnam has a tax rate of 2.85% for some products.

An analyst pointed out that the initial levy rates are generally lower than expected.

However, Tim Brightbill, a partner and chief counsel at Wiley Rein LLP, suggested that the final tax rate may be higher than initially assessed, as in past solar trade cases, with the Department of Commerce only recently beginning to investigate several new subsidy allegations.

Currently, the U.S. Department of Commerce is still conducting preliminary investigations into allegations that solar products imported from target countries to the United States are being dumped and sold at prices below production costs; preliminary investigation results for this case are expected to be announced in November.

Solarvest Executive Director and CEO, Davis Chong, pointed out in an interview with the "Nanyang Business Daily" that Malaysia is actually one of the main suppliers of solar panels to the US market. Once Malaysia's solar manufacturing industry slows down, it will disrupt the US solar supply chain.

He pointed out that, from the current perspective, the impact of tariff measures will bring challenges to local solar panel manufacturers in Malaysia.

However, he mentioned that regardless of changes in the Malaysian supply chain, it will not affect solar projects, because most solar construction, procurement, construction, and commissioning (EPCC) contractors or developers mainly import solar panels from China, ultimately due to China's relatively cheaper prices.

"As for Solarvest, we will not be affected because we will continue to purchase solar panels from China."

"We expect that the companies affected locally will gradually shift their orders from Malaysia to countries with lower tax rates. The impact of this measure is long-term as it will extend to European and Australian countries."

He also said that this means Malaysian manufacturers may find it harder to shift their supplies to these markets.