Section 201 Safeguard Tariffs Imposed on Solar Cells, Large Residential Washers
President Donald Trump on Jan. 23 imposed new Section 201 safeguard tariffs on imports of large residential washers and solar cells and modules, marking the first use of the provision since safeguards were imposed on steel products in 2002. Both of the new safeguards take the form of tariff-rate quotas, with duties on out-of-quota washers starting at 50% and in-quota washers at 20%, and duties on out-of-quota solar cells and modules starting at 30% with in-quota solar cells exempt. Imports from free trade agreement partners, including Canada and Mexico, are mostly covered by the safeguard duties, though Canadian washers will benefit from an exemption.
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Three-Year Safeguard on Washers, Four Years for Solar Cells
As announced the previous day in a U.S. Trade Representative fact sheet, the safeguard tariffs on solar cells and residential washers largely mirror recommendations issued by the International Trade Commission in October and November, respectively (see 1711010040 and 1711220036). Safeguards on residential washers are planned to last three years, and safeguards on solar cells four years, as follows:
Large Residential Washers
| Year 1 | Year 2 | Year 3 | |
| First 1.2 million units | 20% | 18% | 16% |
| All subsequent imports | 50% | 45% | 40% |
| Covered parts | 50% | 45% | 40% |
| Covered parts excluded from TRQ | 50,000 units | 70,000 units | 90,000 units |
Solar Cells and Modules
| Year 1 | Year 2 | Year 3 | Year 4 | |
| First 2.5 gigawatts | 0% | 0% | 0% | 0% |
| All subsequent imports | 30% | 25% | 20% | 15% |
The new safeguard measures will be detailed in a presidential proclamation signed by Trump on Jan. 23. They will “very likely” take effect 15 days after the proclamation, said Timothy Brightbill of Wiley Rein, which represented SolarWorld in the proceeding. SolarWorld and Suniva requested the solar cells safeguard, while Whirlpool asked for the duties on residential washers (see 1705300038 and 1706120020).
Safeguards Largely Apply to NAFTA, South Korea Imports
The safeguard tariffs on large residential washers will apply to Mexico and South Korea, but not Canada, the USTR fact sheet said. The safeguard applies on solar cells from all three countries, it said. “Consistent with [World Trade Organization] obligations,” the U.S. will also exclude all Generalized System of Preferences beneficiaries that account for less than 3 percent of total exports of each product, USTR said. By that threshold, the Philippines is subject to the solar cells safeguard, and Thailand is subject to both, it said.
USTR Hints at Possible Agreement on Solar Cells AD/CV Duties
The safeguard duties come on top of antidumping and countervailing duty orders already in place on large residential washers from South Korea, Mexico and China, as well as AD/CV duties on solar cells and other solar products from China and Taiwan. “The U.S. Trade Representative will engage in discussions among interested parties that could lead to positive resolution of the separate antidumping and countervailing duty measures currently imposed on Chinese solar products and U.S. polysilicon,” it said in a press release announcing the safeguards. “The goal of those discussions must be fair and sustainable trade throughout the whole solar energy value chain, which would benefit U.S. producers, workers, and consumers.”
Trump Says Safeguards Will Create U.S. Jobs; Solar Industry Group Disagrees
Trump’s decision to impose the safeguards is intended to bring manufacturing jobs in both industries back to the U.S., he said at the Jan. 23 signing ceremony. "We're going to benefit our consumers and we're going to create a lot of jobs," he said. "Our action today helps to create jobs in America for Americans. It will provide a strong incentive for LG and Samsung to follow through on their recent promises to build major manufacturing plants for washing machines right here in the United States,” Trump said. “A lot of manufacturers will be coming to the United States to build both washing machines and also solar.” Asked about the potential for retaliation, Trump said: “there won't be a trade war.”
Ohio senators from both sides of the aisle applauded the decision in a joint statement. “I am pleased that the President and the U.S. Trade Representative have taken decisive action to level the playing field and protect American jobs,” Republican Sen. Rob Portman said. “After moving their production from overseas back to Clyde, Ohio, Whirlpool has had to fight a series of cases against companies who would rather cheat than compete,” he said. “This is welcome news for the thousands of Whirlpool workers in Clyde, Ohio, whose jobs have been threatened by a surge of cheap washers,” Democratic Sen. Sherrod Brown said. “These tariffs will help level the playing field, and show anyone who tries to cheat our trade laws that they won’t get away with it.”
SolarWorld also praised the decision to impose safeguard duties, in a separate statement issued Jan. 22. “We will work with the U.S. Government to implement these remedies, including future negotiations, in the strongest way possible to benefit solar manufacturing and its thousands of American workers to ensure that U.S. solar manufacturing is world-class competitive for the long term,” SolarWorld CEO Juergen Stein said. On the other hand, a trade association representing others in the solar industry, including installers of solar panels, said the decision will actually cause a decline in employment. “The decision effectively will cause the loss of roughly 23,000 American jobs this year, including many in manufacturing, and it will result in the delay or cancellation of billions of dollars in solar investments,” the Solar Energy Industries Association said in a press release.