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A ruling issued by U.S. Customs and Border Protection (CBP) on January 9, 2009 has the effect of raising the tariff on certain solar panels from zero to 2.5%. CBP ruled that solar panels that are equipped with a special diode should be classified as more sophisticated generators.
The ruling was issued in response to an inquiry by a firm (GES USA) about what the tariff would be on certain solar panels imported from China. Solar panels have entered the United States duty-free for more than twenty years. Customs responded to the query with a ruling that the panels in question, equipped with a diode that allows electric current to pass around areas of the panel that are in shade, fall into a different category. By finding that these devices are in fact electric generators, CBP made them subject to a duty of 2.5%. CBP stated in its ruling that:
You suggested that the Trinasolar TSM-175D solar module is classifiable under subheading 8541.40.6020 of the Harmonized Tariff Schedule of the United States (HTSUS). Subheading 8541.40.6020 provides for 'Diodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules ... Photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels ... Other diodes: Other: Solar cells: Assembled into modules or made up into panels.' However, Explanatory Note (EN) 85.41 (B) (i) states that heading 8541 does not cover panels or modules equipped with elements, however simple, i.e. diodes to control the direction of the current. As such, since the Trinasolar TSM-175D solar module does contain diodes, classification under subheading HTSUS 8541.40.6020 is inapplicable.
The applicable subheading for the Trinasolar TSM-175D solar module will be 8501.31.8000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for 'Electric motors and generators: Other DC motors; DC generators: Of an output not exceeding 750 W: Generators.' The rate of duty will be 2.5%.
The Solar Energy Industries Association is 'in the process of preparing a challenge' to the ruling, according to SEIA President Rhone Resch. SEIA hopes to persuade CBP to overturn the ruling issued by the New York office. The group represents both U.S. and foreign solar energy companies.
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