IN THE MATTER OF a preliminary injury inquiry, pursuant to subsection 34(2) of the Special Import Measures Act, respecting:
PHOTOVOLTAIC MODULES AND LAMINATES ORIGINATING IN OR EXPORTED FROM THE PEOPLE’S REPUBLIC OF CHINA
The Canadian International Trade Tribunal, pursuant to the provisions of subsection 34(2) of the Special Import Measures Act, has conducted a preliminary injury inquiry into whether the evidence discloses a reasonable indication that the dumping and subsidizing of photovoltaic modules and laminates consisting of crystalline silicon photovoltaic cells, including laminates shipped or packaged with other components of photovoltaic modules, and thin-film photovoltaic products produced from amorphous silicon (a-Si), cadmium telluride (CdTe), or copper indium gallium selenide (CIGS), originating in or exported from the People’s Republic of China, excluding modules, laminates or thin-film products with a power output not exceeding 100 W, and also excluding modules, laminates or thin-film products incorporated into electrical goods where the function of the electrical goods is other than power generation and these electrical goods consume the electricity generated by the photovoltaic product, have caused injury or are threatening to cause injury to the domestic industry.
This preliminary injury inquiry follows the notification, on December 5, 2014, that the President of the Canada Border Services Agency had initiated investigations into the alleged injurious dumping and subsidizing of the above-mentioned goods.
The statement of reasons will be issued within 15 days.
Director, Trade Remedies Investigations: Randolph W. Heggart
. C. Gaz. 2014.I.3040.
. Exhibit PI-2014-003-02.01, Vol. 1A at 210.
. Based on the complainants’ estimates and industry publications. See Exhibit PI-2014-003-02.01, Vol. 1 at 25, 201.
. Canadian Solar Solutions Inc. and its parent, Canadian Solar Inc., both federally incorporated companies, are referred to collectively as “Canadian Solar” for the purposes of the Tribunal’s preliminary injury inquiry. Exhibit PI-2014-003-09, Vol. 10 at 89.
. Exhibit PI-2014-003-10, Vol. 10 at 102.
. Referred to collectively as “Jinko Solar” for the purposes of the Tribunal’s preliminary injury inquiry.
. R.S.C., 1985, c. S-15 [SIMA].
. Exhibit PI-2014-003-10, Vol. 10 at 107.
. Ronald A. Chisholm Ltd. v. Deputy M.N.R.C.E. (1986), 11 CER 309 (FCTD).
. Article 5 of the World Trade Organization (WTO) Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 requires investigating authorities to examine the accuracy and adequacy of the evidence provided in a dumping complaint to determine whether there is sufficient evidence to justify the initiation of an investigation and to reject a complaint or terminate an investigation as soon as the investigating authority is satisfied that there is not sufficient evidence of dumping or injury. Article 5 also specifies that simple assertions that are not substantiated with relevant evidence cannot be considered sufficient to meet the requirements of the article.
. Silicon Metal (21 June 2013), PI-2013-001 (CITT) at para. 16; Unitized Wall Modules (3 May 2013), PI‑2012‑006 (CITT) at para. 24; Liquid Dielectric Transformers (22 June 2012), PI-2012-001 (CITT) at para. 86.
. S.O.R./84-927 [Regulations].
. It is not sufficient that dumping or subsidizing contributes to material injury to a domestic industry or to a threat of material injury. There must be evidence that discloses a reasonable indication that the dumping or subsidizing has caused or is threatening to cause material injury. See Unitized Wall Modules at para. 23.
. The CBSA’s product definition is set out in para. 1.
. In order to decide whether there is more than one class of goods, the Tribunal must determine whether goods potentially included in separate classes of goods constitute “like goods” in relation to each other. If they do, they will be regarded as comprising one class of goods. See, for example, Aluminum Extrusions (17 March 2009), NQ‑2008-003 (CITT) at para. 115; Polyisocyanurate Thermal Insulation Board (11 April 1997), NQ-96-003 (CITT) at 10.
. See, for example, Copper Pipe Fittings (19 February 2007), NQ-2006-002 (CITT) at para. 48.
. While the complainants acknowledge that there is currently no domestic production of thin-film solar modules, they contend that these products and crystalline photovoltaic modules are fully interchangeable, have similar physical characteristics, distribution channels and end uses, and compete directly in the domestic market. See Exhibit PI-2014-003-02.01, Vol. 1 at 27, paras. 45-46; Exhibit PI-2014-003-13.01 at para. 11, Vol. 3C.
. The U.S. International Trade Commission found that thin-film photovoltaic products were not like goods to crystalline photovoltaic products. See Crystalline Silicon Photovoltaic Cells and Modules From China, November 2012, Investigation Nos. 701-TA-481 and 731-TA-1190 (Final) (USITC), at Part II. Similarly, the European Union found that thin-film photovoltaic products were clearly excluded from the product definition, which concerned crystalline photovoltaic products only. See Commission Regulation (EU) No. 513/2013 (4 June 2013), Official Journal of the European Union, L152/5 at para. 41.
. See Anti-dumping Investigation concerning imports of solar cells whether or not assembled partially or fully in Modules or Panels or on glass or some other suitable substrates, originating in or exported from Malaysia, China PR, Chinese Taipei and USA, The Gazette of India: Extraordinary, Part I, Section 1, New Delhi (22 May 2014), 126 at xii. In this case, the goods were defined to include both crystalline photovoltaic and thin-film photovoltaic products.
. Exhibit PI-2014-003-07.02, Exhibit PI-2014-003-07.03, Exhibit PI-2014-003-07.04, Exhibit PI-2014-003-07.05, Exhibit PI-2014-003-07.06, Exhibit PI-2014-003-07.07, Exhibit PI-2014-003-07.08, Exhibit PI-2014-003-07.09, Exhibit PI-2014-003-07.10, Exhibit PI-2014-003-07.11, Exhibit PI-2014-003-07.12, Exhibit PI-2014-003-07.12A, Exhibit PI-2014-003-07.13, Exhibit PI-2014-003-07.14, Exhibit PI-2014-003-07.15, Exhibit PI-2014-003-07.15A, Vol. 5; Exhibit PI-2014-003-07.16, Exhibit PI-2014-003-07.17, Exhibit PI-2014-003-07.17A, Exhibit PI‑2014‑003-07.17B, Exhibit PI-2014-003-07.18, Exhibit PI-2014-003-07.19, Exhibit PI-2014-003-07.20, Exhibit PI-2014-003-07.21, Exhibit PI-2014-003-07.22, Exhibit PI-2014-003-07.22A, Vol. 5A; Exhibit PI‑2014‑003-08.17 (protected), Exhibit PI-2014-003-08.18 (protected), Vol. 6.
. Exhibit PI-2014-003-07.10, Vol. 5 at 143; Exhibit PI-2014-003-07.15, Vol. 5 at 185; Exhibit PI-2014-003-07.17, Vol. 5A at 11; Exhibit PI-2014-003-07.20, Vol. 5A at 64; Exhibit PI-2014-003-07.22, Vol. 5A at 76.
. Exhibit PI-2014-003-07.10, Vol. 5 at 143; Exhibit PI-2014-003-07.17, Vol. 5A at 11; Exhibit PI-2014-003-07.20, Vol. 5A at 64.
. Exhibit PI-2014-003-02.01, Vol. 1B at 17, 58, Vol. 1D at 60, Vol. 1E at 19, 62, Vol. 1G at 23.
. See, for example, Copper Pipe Fittings at para. 53; Circular Copper Tube (18 December 2013), NQ-2013-004 (CITT) at para. 44. This view is consistent with the WTO Appellate Body’s decision in United-States—Safeguard Measure on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia (2001), WTO Docs. WT/DS177/AB/R, WT/DS178/AB/R at para. 94 (Appellate Body Report), where it held that the focus should be on the products, not on how they were produced.
. Stainless Steel Wire (30 July 2004), NQ-2004-001 (CITT) at paras. 38-40; Concrete Reinforcing Bar (9 January 2015), NQ-2014-001 (CITT) at paras. 67, 74.
. Circular Copper Tube at paras. 55-58; Concrete Reinforcing Bar at para. 66.
. Exhibit PI-2014-003-11.03 at 42, Vol. 3.
. The term “major proportion” means an important, serious or significant proportion of total domestic production of like goods and not necessarily a majority. Japan Electrical Manufacturers Assoc. v. Canada (Anti-Dumping Tribunal),  2 FC 816 (F.C.A); China – Anti-dumping and Countervailing Duties on Certain Automobiles from the United States (23 May 2014), WTO Doc. WT/DS440/R, Report of the Panel at para. 7.207; European Community – Definitive Anti-dumping Measures on Certain Iron or Steel Fasteners from China (15 July 2011), WTO Doc. WT/DS397/AB/R, Report of the Appellate Body at paras. 411, 419, 430; Argentina – Definitive Anti‑dumping Duties on Poultry from Brazil (22 April 2003), WTO Doc. WT/DS241/R, Report of the Panel at paras. 7.341-7.344.
. Exhibit PI-2014-003-10 at paras. 9, 11, Vol. 10.
. Exhibit PI-2014-003-02.01, Vol. 1 at 26.
. Exhibit PI-2014-003-09, Vol. 10 at 89-91.
. Exhibit PI-2014-003-09A (protected), Vol. 2C at 18-19.
. Exhibit PI-2014-003-13.01, tab C, Vol. 3C.
. In European Community – Definitive Anti-Dumping Measures on Certain Iron or Steel Fasteners from China (15 July 2011), WTO Doc. WT/DS397/AB/R, Report of the Appellate Body at paras. 412, 419, 422, 430, the WTO Appellate Body found that, while a lower proportion may be permissible in a fragmented industry, 27 percent of total domestic production is not a major proportion. The Appellate Body did not specify what threshold is required to establish a major proportion, but indicated that it should be a relatively high proportion to avoid a distorted analysis.
. See, for example, Copper Rod (28 March 2007), NQ-2006-003 (CITT) at para. 48; Seamless Carbon or Alloy Steel Oil and Gas Well Casing (10 March 2008), NQ-2007-001 (CITT) at paras. 76-77; Aluminum Extrusions at para. 147.
. The WTO Appellate Body recently found that cross-cumulating the effects of imports from countries subject to simultaneous dumping and subsidizing investigations with those of countries subject to parallel dumping investigations only constituted a violation of the Agreement on Subsidies and Countervailing Measures. See United States - Countervailing Measures on Certain Hot-Rolled Carbon Steel Flat Products from India (8 December 2014), WTO Doc. WT/DS436/AB/R, Report of the Appellate Body. The Tribunal considers the circumstances in that case dissimilar to the present preliminary injury inquiry, which involves only one country, China, the goods from which have been found, on a preliminary basis, to be both dumped and subsidized. Accordingly, there is no risk of improperly attributing the impacts of either the dumping or subsidizing to a country that has not been found to be dumping or subsidizing, as the case may be.
. Statistics Canada does not report import volumes for the relevant Harmonized System (HS) tariff classification code. Since the CBSA’s methodology for estimating import volumes was not disclosed, the Tribunal relied on the complainants’ (corrected) data on import volumes by using import values from Statistics Canada multiplied by average weekly solar spot prices for multi-crystalline silicon modules reported by Bloomberg New Energy Finance. See Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212.
. The CBSA’s estimate shows a similar trend of the subject goods accounting for an increasing share of total imports of photovoltaic modules and laminates, rising from 55.5 percent in 2012 to 72 percent in 2013, reaching 85.1 percent in the first half of 2014. See Exhibit PI-2014-003-10, Vol. 10 at 104.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212; Exhibit PI-2014-003-9A (protected), Vol. 2C at 19.
. Exhibit PI-2014-003-02.01, Vol. 1 at 21.
. The complaint does not allege price suppression.
. The Tribunal relied on the complainants’ estimates of Chinese import values for the purposes of its preliminary injury inquiry, as unit import values for the relevant HS classification code are not available from Statistics Canada data.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212; Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 39.
. Without a breakdown in prices by non-subject country, it is not possible to determine at this stage whether a particular country or countries may be responsible for the higher average prices of non-subject countries.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 168-72, 208-210; Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 11-12, 18-38; Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 214; Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 217-18, 222.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 208-210.
. Ibid. at 212; Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 39.
. Such factors and indices include “. . . (i) any actual or potential decline in output, sales, market share, profits, productivity, return on investments or the utilization of industrial capacity, (ii) any actual or potential negative effects on cash flow, inventories, employment, wages, growth or the ability to raise capital, (ii.1) the magnitude of the margin of dumping or amount of subsidy in respect of the dumped or subsidized goods, and (iii) in the case of agricultural goods, including any goods that are agricultural goods or commodities by virtue of an Act of Parliament or of the legislature of a province, that are subsidized, any increased burden on a government support programme”.
. Paragraph 37.1(3)(b) of the Regulations directs the Tribunal to consider whether any factors other than dumping or subsidizing of the subject goods have caused injury. The factors which are prescribed in this regard are “. . . (i) the volumes and prices of imports of like goods that are not dumped or subsidized, (ii) a contraction in demand for the goods or like goods, (iii) any change in the pattern of consumption of the goods or like goods, (iv) trade-restrictive practices of, and competition between, foreign and domestic producers, (v) developments in technology, (vi) the export performance and productivity of the domestic industry in respect of like goods, and (vii) any other factors that are relevant in the circumstances.”
. The complaint did not include arguments or evidence of any negative impact on cash flow, inventories, return on investments or the ability to raise capital.
. Exhibit PI-2014-003-13.01 at 28, Vol. 3C.
. Canada – Certain Measures Affecting the Renewable Energy Generation Sector and Canada – Measures Relating to the Feed-in Tariff Program (6 June 2013), WTO Docs. WT/DS412/AB/R and WT/DS426/AB/R, Reports of the Appellate Body.
. Canadian Solar provided, in the attachments to its brief, an income statement summary for the company’s global operations (Exhibit PI-2014-003-11.04, Exhibit 1, Vol. 3B); however, it did not file any income statements specific to its Canadian operations.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 240; Exhibit PI-2014-003-9A (protected), Vol. 2C at 19.
. There is other evidence on the record that indicates that Celestica’s production volume in 2013 may have been even higher than estimated by the complainants. Specifically, the International Energy Agency’s “National Survey Report of PV Power Applications in Canada 2013” shows the 2013 production for individual domestic producers, including 200 megawatts for Celestica. See Exhibit PI-2014-003-02.01, Vol. 1 at 201.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212, Vol. 2A at 39; Exhibit PI-2014-003-9A (protected), Vol. 2C at 19.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212, Vol. 2A at 39.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 208-210.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2A at 217-18, 222.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212, Vol. 2A at 39.
. Subsection 37.1(2) of the Regulations reads as follows: “For the purposes of determining whether the dumping or subsidizing of any goods is threatening to cause injury, the following factors are prescribed: (a) the nature of the subsidy in question and the effects it is likely to have on trade; (b) whether there has been a significant rate of increase of dumped or subsidized goods imported into Canada, which rate of increase indicates a likelihood of substantially increased imports into Canada of the dumped or subsidized goods; (c) whether there is sufficient freely disposable capacity, or an imminent, substantial increase in the capacity of an exporter, that indicates a likelihood of a substantial increase of dumped or subsidized goods, taking into account the availability of other export markets to absorb any increase; (d) the potential for product shifting where production facilities that can be used to produce the goods are currently being used to produce other goods; (e) whether the goods are entering the domestic market at prices that are likely to have a significant depressing or suppressing effect on the price of like goods and are likely to increase demand for further imports of the goods; (f) inventories of the goods; (g) the actual and potential negative effects on existing development and production efforts, including efforts to produce a derivative or more advanced version of like goods; (g.1) the magnitude of the margin of dumping or amount of subsidy in respect of the dumped or subsidized goods; (g.2) evidence of the imposition of anti-dumping or countervailing measures by the authorities of a country other than Canada in respect of goods of the same description or in respect of similar goods; and (h) any other factors that are relevant in the circumstances.”
. Exhibit PI-2014-003-02.01, Vol. 1 at 131-47.
. Exhibit PI-2014-003-12.06 (protected) at para. 157, Vol. 4A.
. Exhibit PI-2014-003-03.01 (protected), Vol. 2 at 212.
. Exhibit PI-2014-003-02.01 at para. 344, Table 6, Vol. 1; Exhibit PI-2014-003-03.01A (protected), Attachment 96, Vol. 2.01.
. Exhibit PI-2014-003-02.01 at para. 342, Vol. 1; Exhibit PI-2014-003-03.01A (protected), Attachment 89, Vol. 2.01.
. Exhibit PI-2014-003-02.01 at paras. 348-50, Vol. 1; Exhibit PI-2014-003-03.01A (protected), Attachment 117, Vol. 2.01.
. Exhibit PI-2014-003-02.01 at paras. 352-53, Vol. 1; Exhibit PI-2014-003-02.01, Vol. 1G at 5; Exhibit PI‑2014‑003-02.01, Vol. 1E at 4.