JA Solar Holdings (JASO) Withdraws from EU's Price Undertaking; Says MIP No Longer Reflects Market
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JA Solar Holdings Co., Ltd. (Nasdaq: JASO) announced its decision to withdraw from the European Union’s ("EU") price undertaking. The Company will now serve the European market through its manufacturing facilities outside of China.
In December 2013, the Council of the European Union imposed definitive anti-dumping and anti-subsidy duties on solar cells and panels imported from China. In parallel, the European Commission accepted a price undertaking, whereby companies were required to sell solar cells and panels in the EU at a price above a fixed Minimum Import Price ("MIP"), or else be levied anti-dumping and anti-subsidy duties. Facing anti-dumping and anti-subsidy duties of 51.5% and 5.0%, respectively, JA Solar chose to participate in the price undertaking at the time and has since demonstrated full compliance with its terms and conditions.
However, JA Solar believes the MIP currently in place no longer accurately reflects the market environment, as average selling prices in the EU are already considerably below today’s MIP and continue to decrease. The Company concluded that it can remain competitive in the EU markets only if it withdraws from the price undertaking.
Mr. Baofang Jin, JA Solar’s Chairman and CEO, commented, “We are committed to fair trade and market competition, as reflected by our prior participation in, and compliance with, the terms of the price undertaking. However, we strongly believe that the current MIP does not reflect the recent price trends in the market. Selling prices continue to decline, while the MIP has remained unchanged for the past 18 months. Unfortunately, the current MIP adversely impacts our ability to execute our business strategy and hinders the growth of the European solar industry. As a result, we believe that withdrawing from the price undertaking agreement is our only choice to be competitive and further our goal of providing clean energy to the EU. We believe this step will be beneficial to EU power producers, consumers, and the environment.”
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