EU continues anti-subsidy investigation on Chinese solar panels

After weeks of negotiation, the European Commission decided not to impose provisional duties on Chinese solar panels, but will continue an anti-subsidy investigation on Wednesday.

According to the Reuters, the EU chose not to take provisional measures but it has until December 5 to decide whether to impose definitive anti-subsidy duties.

"The investigation will continue without provisional measures and the Commission will continue working actively on the case in order to arrive at definitive findings that are due at the end of this year," it said in a statement.

The Commission said its decision not to impose any provisional anti-subsidy measures did not prejudice any subsequent decision at the final stage in December, after consulting interested parties.

Bloomberg said the commission is engaged in a political balancing act as it seeks to limit Chinese competition against European manufacturers such as Solarworld AG. (SWV) The renewable-energy dumping and subsidy cases cover EU imports of crystalline silicon photovoltaic modules or panels, and cells and wafers used in them -- shipments valued at 21 billion euros ($28 billion) in 2011.

In early June this year, the EU implemented a provisional round of anti-dumping duties on Chinese solar producers after it found that the country was illegally undercutting prices for solar panels and key components such as wafers and cells, triggering the biggest Sino-EU trade row by far.

However, tensions eased after an amicable agreement was reached last month under which producers accounting for about 70 percent of Chinese solar panel exports to the EU have agreed to set a minimum price for them.

China's Ministry of Commerce spokesman Shen Danyang said on Wednesday that the price undertaking deal, which took effect on Tuesday, will help Chinese solar panel producers secure a reasonable market share in its exports to Europe.

Europe is China's largest trading partner, while for the EU, China is second only to the United States. Chinese statistics showed that bilateral trade reached $546 billion last year.