CANADIAN SOLAR, INC., CHANGZHOU TRINA SOLAR ENERGY CO., LTD., HEFEI JA SOLAR TECHNOLOGY CO., LTD., SHANGHAI JA SOLAR TECHNOLOGY CO., LTD., YINGLI GREEN ENERGY HOLDING COMPANY LIMITED, YINGLI GREEN ENERGY AMERICAS, INC., Plaintiffs-Appellants
UNITED STATES, SOLARWORLD AMERICAS, INC., Defendants-Appellees SHANGHAI BYD CO., LTD., BYD (SHANGLUO) INDUSTRIAL CO., LTD., CHINA SUNERGY (NANJING) CO., LTD., CHINT SOLAR (ZHEJIANG) CO., LTD., ET SOLAR INDUSTRY LTD., JINKO SOLAR CO., LTD., LDK SOLAR HI-TECH (NANCHANG) CO., LTD., PERLIGHT SOLAR CO., LTD., RENESOLA JIANGSU LTD., SHENZHEN SACRED INDUSTRY CO., LTD., SHENZHEN SUNGOLD SOLAR CO., LTD., SUMEC HARDWARE & TOOLS CO., LTD., SUNNY APEX DEVELOPMENT LTD., WUHAN FYY TECHNOLOGY CO., LTD., WUXI SUNTECH POWER CO., LTD., ZHONGLI TALESUNSOLAR CO., LTD., ZNSHINE PV-TECH CO., LTD., SUNPOWER CORPORATION, Plaintiffs
from the United States Court of International Trade in Nos.
1:15-cv-00067-CRK, 1:15-cv-00083-CRK, 1:15-cv-00087-CRK,
1:15-cv-00088-CRK, 1:15-cv-00089-CRK, 1:15-cv-00090-CRK,
Judge Claire R. Kelly.
Spencer Stewart Griffith, Devin S. Sikes, Akin Gump Strauss
Hauer & Feld LLP, Washington, DC, argued for
K. Hogan, Commercial Litigation Branch, Civil Division,
United States Department of Justice, Washington, DC, argued
for defendant-appellee United States. Also represented by
Reginald Thomas Blades, Jr., Robert Edward Kirschman, Jr.,
Joseph H. Hunt; Scott Daniel McBride, Office of the Chief
Counsel for Import Administration, United States Department
of Commerce, Washington, DC.
Timothy C. Brightbill, Wiley Rein, LLP, Washington, DC,
argued for defendant-appellee SolarWorld Americas, Inc. Also
represented by Stephanie Manaker Bell, Tessa V. Capeloto,
Laura El-Sabaawi, Cynthia Cristina Galvez, Usha Neelakantan,
Adam Milan Teslik, Maureen E. Thorson.
Newman, O'Malley, and Chen, Circuit Judges.
O'MALLEY, CIRCUIT JUDGE.
an appeal from a judgment of the Court of International Trade
sustaining a remand determination from the U.S. Department of
Commerce ("Commerce"). Sun-Power Corp. v.
United States, 253 F.Supp.3d 1275 (Ct. Int'l Trade
2017) ("Solar II China"). In its remand
determination, Commerce imposed countervailing and
antidumping duties on the importation of a class or kind of
merchandise-specifically, solar cells and modules, laminates,
and/or panels (collectively, "panels"), containing
solar cells imported or sold for importation to the United
States from the People's Republic of China
("China"). Final Results of Redetermination
Pursuant to Ct. Order, Sun-Power Corp. v. United
States, No. 15-00067 (Oct. 5, 2016) ("Solar II
China Remand Results"), ECF No. 105-1. When
defining the class or kind of merchandise within the scope of
the orders, Commerce used a new test, rather than the
typically-used "substantial transformation" test,
to determine the country of origin. Appellants contend that
Commerce failed to provide a reasoned explanation for
departing from its previous practice and that substantial
evidence does not support its findings. Because we conclude
that Commerce provided a reasoned explanation and that
substantial evidence supports its findings, we affirm.
Tariff Act of 1930, as amended, authorizes Commerce to
initiate countervailing or antidumping duty investigations,
and, in certain circumstances, impose duties on foreign
merchandise sold, or likely to be sold, in the United States.
19 U.S.C. §§ 1671, 1673. Specifically, Commerce may
impose countervailing duties "to address government
subsidies to foreign producers," and it may impose
antidumping duties to "provide relief from market
distortions caused by foreign producers who sell their
merchandise in the United States for less than fair market
value," so long as the U.S. International Trade
Commission ("Commission") finds that those
activities materially injure or threaten to materially injure
domestic industry. Bell Supply Co. v. United States,
888 F.3d 1222, 1225 (Fed. Cir. 2018).
countervailing or antidumping duty investigation typically
begins with a petition filed by a domestic industry.
Id. If the investigation reveals dumping or foreign
subsidies that injure the domestic industry, Commerce must
issue an order imposing countervailing or antidumping duties.
In this order, Commerce describes the class or kind of
merchandise within the scope of the order in two parts-first,
the type of merchandise, i.e., its technical characteristics,
and second, the merchandise's country of origin.
Certain Cold-Rolled Carbon Steel Flat Prods. From
Argentina, 58 Fed. Reg. 37, 062, 37, 065 (Dep't of
Commerce July 9, 1993); see Glob. Commodity Grp. LLC v.
U.S., 709 F.3d 1134, 1140 (Fed. Cir. 2013) (affirming
Commerce's class or kind determination because it
"appropriately accounts for both the physical scope of
the product as well as the country of origin.").
typically determines country of origin based on the country
where the merchandise is processed or manufactured. See
Cold-Rolled Carbon, 58 Fed. Reg. at 37, 065. But, in
circumstances in which the merchandise undergoes partial
processing or manufacturing in multiple countries, Commerce
relies on the substantial transformation test. Id.
Under the substantial transformation test, a solar cell
manufactured in country A, but assembled into a panel
elsewhere would cease to be from country A if, as a result of
the assembly process, the solar panel "loses its
identity and is transformed into a new product having a new
name, character and use." Bell Supply, 888 F.3d
at 1228 (quoting Bestfoods v. United States, 165
F.3d 1371, 1373 (Fed. Cir. 1999)).
Parties & The Merchandise
an appellee in this appeal, is a domestic producer of solar
products. It initiated the trade remedy investigations from
which this appeal arises by filing petitions alleging injury
to the domestic solar industry. The appellants in this
appeal-Canadian Solar, Inc., Changzhou Trina Solar Energy
Co., Ltd., Hefei JA Solar Technology Co., Ltd., Shanghai JA
Solar Technology Co., Ltd., Yingli Green Energy Holding
Company Limited, and Yingli Green Energy Americas,
Inc.-export and/or produce the class or kind of merchandise
within the scope of Commerce's orders from/in China.
the parties agree on the type of merchandise within
the scope of Commerce's order-crystalline silicon
photovoltaic cells, and modules, laminates, and/or panels
consisting of crystalline silicon photovoltaic cells, whether
or not partially or fully assembled into other products,
including building integrated materials-they dispute whether
Commerce erred in its country of origin analysis.
orders at issue in Solar II China are the subject of
this appeal, but two prior sets of orders are relevant to the
issues before us. Each of these is detailed below.
Solar I China
November 16, 2011, Commerce initiated countervailing and
antidumping investigations based on petitions filed by
SolarWorld. The investigations resulted in countervailing
duty and antidumping duty orders covering both solar cells
and solar panels containing solar cells from China.
Crystalline Silicon Photovoltaic Cells, Whether or Not
Assembled Into Modules, From the People's Republic of
China, 77 Fed. Reg. 73, 018 (Dep't of Commerce Dec.
7, 2012) (antidumping duty order); Crystalline Silicon
Photovoltaic Cells, Whether or Not Assembled Into Modules,
From the People's Republic of China, 77 Fed. Reg.
73, 017 (Dep't of Commerce Dec. 7, 2012) (countervailing
duty order) (collectively, "Solar I
some solar cells manufactured in China can be assembled into
panels elsewhere and because some solar cells manufactured
elsewhere can be assembled into panels in China, Commerce
applied the substantial transformation test to determine the
country of origin. Commerce determined that the solar cell is
the origin-conferring component because the process of
assembling the solar cells into panels does not constitute a
substantial transformation. SunPower, 253 F.Supp.3d
at 1279 & n.3. Commerce therefore concluded that the duty
orders covered solar cells and solar panels from
China-including solar panels assembled outside of China using
Chinese solar cells, but excluding solar panels assembled in
China using non-Chinese solar cells. Id.
Solar I Taiwan
later filed petitions alleging that imports of solar cells
and panels from Taiwan had increased, causing injury to the
domestic solar industry. Id. at 1280. Commerce
initiated an antidumping investigation and eventually issued
an antidumping duty order. Id. In its order,
Commerce applied the substantial transformation test to
conclude-as it had in Solar I China-that the solar
cells are the origin-conferring input. Certain
Crystalline Silicon Photovoltaic Products from Taiwan,
80 Fed. Reg. 8, 596 (Dep't of Commerce Feb. 18, 2015)
(antidumping duty order) ("Solar I
Taiwan"). Thus, the scope of the order in Solar
I Taiwan covers Taiwanese solar cells and solar