The U.S. Court of International Trade (CIT) recently ruled that the Biden administration's two-year suspension of tariffs on solar cell and module imports from Southeast Asia was illegal. This ruling means that large quantities of low-priced solar products imported from Southeast Asia (mostly produced in China) between June 6, 2022, and June 6, 2024, will now face retroactive tariffs.

The core initiators of this lawsuit are Auxin Solar Inc. and Concept Clean Energy Inc. In their lawsuit, the two companies argue that the Biden administration's suspension of tariffs exceeded the presidential authority and that the Department of Commerce's tariff suspension was illegal.

The plaintiffs emphasize that the tariff suspension unreasonably allowed low-priced imports into the U.S. market, harming domestic manufacturing.

With the court ruling in effect, U.S. Customs and Border Protection (CBP) can immediately initiate retroactive tariff collection procedures, imposing tens of billions of dollars in tariffs on solar cells and modules imported from Cambodia, Malaysia, Thailand, and Vietnam during the suspension period.

According to the Coalition for a Prosperous America report, "Revenue Impact of Retroactive Tariffs on U.S. Solar Imports During the 2022-2024 Tariff Suspension Period," released this spring, a conservative estimate suggests that these retroactive tariffs could generate $54 billion in revenue for the U.S. Treasury. The report also states that retroactive tariffs will level the playing field for domestic solar manufacturers, alleviating the unfair competition they have long faced from subsidized and artificially low-priced Chinese imports. Thomas Beline, an attorney representing plaintiffs Auxin Solar Inc. and Concept Clean Energy Inc., told the media: "This is a clear victory."

In fact, the case centered on the legality of federal Proclamation 10414. The Biden administration issued a two-year emergency suspension of anti-dumping and countervailing duties on solar cells and modules from four Southeast Asian countries. Although the US government had previously preliminarily determined that Chinese companies were circumventing existing tariffs through Southeast Asian countries, the original purpose of the suspension was to ensure smooth import channels and facilitate the implementation of US solar projects. Notably, Auxin Solar Inc., one of the plaintiffs in this case, initially filed the anti-circumvention lawsuit against Southeast Asian solar products. During the suspension, the US Department of Commerce instructed Customs and Border Protection to suspend the collection of the relevant tariffs.

The plaintiffs' victory in the case means the US government must rescind all tariff suspensions and retroactively impose tariffs on all products imported during the suspension period that have not yet been cleared. These tariffs could cause significant losses and uncertainty for importers, developers, and utilities, who have already used these low-priced equipment in multiple projects, some of which are now completed. The retroactive tariffs could reach over 200% of the value of the imported products.

"For all affected importers, even calculated under the current tariff system, the tariffs are substantial," said Belin. The defendants and related stakeholders have begun taking countermeasures. First, they have filed an appeal with the U.S. Court of Appeals for the Federal Circuit; second, they have requested a "stay of tariffs pending appeal" to alleviate short-term financial pressures; and third, they have pursued political channels to eliminate the retroactive tariffs. Reportedly, those involved in the response include industry associations and leading companies, including the U.S. Clean Energy Council, BYD, Canadian Solar, Risen Energy, and Trina Solar.

Belin believes the ruling serves as a wake-up call for the "blind pursuit of profits during trade disputes." He stated, "During this period, some companies, blinded by short-term profits, acted imprudently, driving product prices to such low levels—an unwise choice in itself." He further stated that the court's ruling, in essence, clarifies the principle that the U.S. President has the authority to declare an industrial trade emergency, but not to repeal tariffs already in effect. The decision to issue the stay order was inherently flawed, and he hopes such a situation will not recur.

At present, the U.S. Court of International Trade has only published a brief summary of the judgment. The full judgment text containing non-confidential information is expected to be officially released in the "Judgment Announcement" column of the court's official website this weekend.