* Commissioners back EU trade chief's proposal
* EU producers say China has captured 80 pct of market
* SolarWorld shares rise, China's Suntech stock falls
By Robin Emmott and Francesco Guarascio
BRUSSELS, May 8 The European Commission agreed
on Wednesday to impose punitive import duties on solar panels
from China in a move to guard against what it sees as Chinese
dumping of cheap goods in Europe.
EU commissioners backed EU Trade Chief Karel De Gucht's
proposal to levy the provisional duties by June 6 and make
Chinese solar exports less attractive in Europe, two officials
Shares in German manufacturers SolarWorld, Phoenix
Solar and Centrotherm rose as much as 7
percent on the decision, while Frankfurt-listed shares in
China's Suntech were down more than 4 percent.
The investigation into accusations of dumping is the biggest
the commission has launched but Brussels is trying to tread a
careful path, knowing it needs China, the EU's second largest
trading partner, to help the bloc pull out from recession.
China's ambassador to the World Trade Organisation, Yi
Xiaozhun, called the decision a mistake although he declined to
comment on any possible retaliation by Beijing.
"It will send the wrong message to the world that
protectionism is coming," Yi told Reuters in Geneva.
Given that Germany and France are seeking to increase
exports to China, De Gucht will try for a negotiated solution
with new Chinese Commerce Minister Gao Hucheng before an EU
deadline in December to cement the levies for up to five years.
That could mean agreeing a minimum price at which all solar
panels makers selling in Europe adhere to, diplomats said.
The EU duties, which will come into effect once the
Commission publishes the decision in its Official Journal, will
be set at an average of 47 percent, officials said.
Trade specialists from all 27 EU countries will be consulted
on May 15 at a meeting in Brussels and are expected to back the
decision, although their position is non-binding.
The European Commission declined to comment.
Chinese solar panel production quadrupled between 2009 and
2011 to more than the entire global demand. EU producers say
Chinese companies have captured more than 80 percent of the
European market from almost zero a few years ago, exporting 21
billion euros ($27 billion) to the European Union in 2011.
As a result, Chinese-made panels are as much as 45 percent
cheaper than those made in Europe, industry executives say.
Europe accounted for half of the global market in 2012,
which was worth $77 billion, according to research firm IHS.
The commission started its investigation in September,
taking up a complaint by a group of mainly German and Italian
companies led by SolarWorld, which was once Germany's biggest
solar group but now has 900 million euros in liabilities. Its
smaller rival Q-Cells filed for insolvency last year.
The United States levied its own duties on Chinese solar
energy products in 2012, arguing that China's rapid expansion
into the industry has created a massive oversupply.
Solar is the leading source of renewable energy after hydro
and wind, and companies are in a race to win contracts as
countries seek to limit pollution and global warming.
Germany was the world's biggest market last year, followed
by China, Italy and the United States, according to the European
Photovoltaic Industry Association. Germany installed more solar
panels than any other country in 2012, at 7.6 gigawatts of newly
connected systems, while China was second with 5 gigawatts.
Solar covers about 3 percent of Europe's electricity demands
but government support for developing the green energy source
varies widely across Europe with the euro zone debt crisis
dampening government support in Spain and Greece.
Europe's stance on solar energy is complicated by the fact
that some in the EU solar sector, notably importers and
installers, support cheap panel imports from China.
They say EU tariffs would be damaging for efforts to develop
clean energy. Some fear retaliation by Beijing.
"Protective duties are poisonous for the solar industry,"
said Udo Mohrstedt, chief executive of Germany's IBC Solar.
"These guarding measures will endanger more than 70,000 jobs in
medium-sized companies in Germany alone," he said.