In August the Court of International Trade held that the two-year moratorium on solar circumvention duties was unlawful, vacated the rule that implemented it, and ordered the government to collect duties retroactively on entries made while it was in effect.
The order has been stayed pending appeal, so nothing is being collected today. But the ruling stands, and it puts an unresolved liability on equipment that has been generating power for years.
If your organization installed solar between mid-2022 and mid-2024, this concerns you.
On August 22, in Auxin Solar Inc. v. United States, Judge Timothy Reif held that Section 318(a) of the Tariff Act of 1930 does not reach solar cells and modules.
The statute authorizes emergency action regarding “food, clothing, and medical, surgical, and other supplies for use in emergency relief work.” Applying the interpretive canons that a general term takes its meaning from the specific terms around it, the court concluded that solar equipment is not that kind of good, and that the duty suspension rule was therefore beyond the agency’s authority.
The court also observed that the government’s broader reading would permit any president to nullify the entire antidumping and countervailing duty regime by declaring an emergency.
We flagged in September 2022 that the moratorium rested on a contested legal basis and that the risk belonged in the contract. This is that risk arriving.
A vacatur alone would have been survivable. The remedy went further.
The order vacated the duty suspension rule in full, directed the government to liquidate and collect duties on presently unliquidated entries, and directed it to identify, collect on, and reliquidate entries that had already been liquidated.
That last clause is the one that matters. Reliquidation reaches back into transactions that were closed. Equipment that cleared customs duty-free in 2023, was installed, and has been operating since is within the scope of the order.
The government identified roughly 44,000 entries as the universe potentially in scope, covering imports between April 2022 and June 2024, though Customs review has since narrowed the live set considerably, to something closer to 20,000. Dollar estimates circulating in the trade press are not government figures. They are third-party calculations derived from import volumes, and they run into the tens of billions. Nobody has a precise number and everyone agrees it is very large.
In September, on a motion brought by the private defendant-intervenors and unopposed by the government, the court stayed its own order pending appeal. No duties are being collected while the stay holds.
The private defendant-intervenors have appealed to the Federal Circuit, and that appeal is what the stay is pending. Opening briefing is scheduled for November. A resolution is unlikely to arrive quickly; appeals of this kind commonly take a year or more.
So the honest status is: a court has held the moratorium unlawful and ordered retroactive collection, that holding has not yet been reviewed on appeal, and the only thing preventing collection is a stay that exists because everyone agrees the question should be settled before money moves.
The useful question is not who wins. It is who bears the loss if the ruling survives.
Retroactive duty liability attaches to the importer of record. On most commercial and public agency projects that is the EPC or a distributor rather than the owner, but not always, and the answer determines where the exposure sits.
From there, three things follow.
Identify the importer of record on your 2022 to 2024 equipment. This is a document request. Some counterparties will not have it readily available, which is itself informative.
Read the duties and change-in-law provisions in the contracts from that period. Most of them allocated duty risk somewhere. Frequently it was buried in a change-in-law clause that nobody negotiated hard, because by the time contracts were signed the moratorium appeared to have settled the question. A clause drafted to address prospective duty changes may not address a retroactive assessment on a closed entry, and that gap is worth identifying now.
Assess whether the counterparty is still there. An indemnity from a supplier that has since exited the US market is worth very little. Several suppliers active in that period no longer are.
For a district, a municipality, or any agency operating on public funds, this has a dimension private owners do not face.
A retroactive duty assessment years after a project was commissioned is not simply an unbudgeted expense. It is an unbudgeted expense against a capital project that was already closed out, potentially audited, and in some cases financed with grant funds or bond proceeds carrying their own conditions.
We are not suggesting agencies accrue for this today. The stay is in place, the appeal is pending, and the amount is unquantifiable at the entity level without knowing the importer of record and entry values. But general counsel and finance staff should know the exposure exists, and the file should be assembled while the people who ran the procurement are still available to explain it.
Two things worth keeping distinct.
This ruling concerns the circumvention case and the moratorium. It is separate from the new antidumping and countervailing duty orders issued this summer on the same four countries, which are new cases on their own merits and which govern equipment being purchased now.
And it does not affect the federal tax credit analysis. The credits, the domestic content bonus, and the new foreign entity sourcing requirements operate independently of the duty question. A project can be perfectly positioned on the tax side and still carry duty exposure from 2023 procurement.
For equipment being bought today, the operative questions remain supplier certification under the current orders and material assistance sourcing under the new tax rules. For equipment bought three years ago, the question is contractual, and it is worth asking before an appellate court answers it for you.
