The United States has announced plans to impose tariffs as high as 3,521 percent on solar panels imported from Southeast Asia, escalating its efforts to curb what it claims are unfair trade practices linked to Chinese government subsidies.

The U.S. Commerce Department said Monday that the proposed duties target imports from Cambodia, Malaysia, Thailand, and Vietnam. The tariffs stem from year-long anti-dumping and countervailing duty (CVD) investigations initiated by U.S. solar manufacturers, including Hanwha Qcells, First Solar, and Convalt Energy.

The firms allege that Chinese companies circumvented existing tariffs by shifting production to Southeast Asia.

Among the key findings, the department stated that these are among the first CVD cases in which an affirmative determination was made that firms were benefiting from ‘transnational subsidies’ provided by the Chinese government while operating in other countries.

The U.S. International Trade Commission (ITC) will make the final decision on the imposition of duties in June.

If confirmed, the penalties will add to a 10 percent blanket tariff introduced in April by former President Donald Trump, as part of a broader push to reduce U.S. trade deficits. The proposed tariffs are wide-ranging: solar products from Cambodia could face duties of up to 3,521 percent, while Malaysia, Vietnam, and Thailand would see rates from 40 percent to over 375 percent, particularly targeting Chinese firms such as Jinko Solar and Trina Solar.

In 2023, the United States imported $11.9 billion worth of solar panels from the four affected countries.