Suntech – a unit of ambitious China-based clean energy group Shunfeng – said the minimum pricing agreement (MIP) no longer reflects the reality of falling prices in the global market and is bad for its business.

The MIP system was the result of a deal struck between the European Commission (EC) and Chinese PV manufacturers in 2013 as an alternative to the imposition of anti-dumping and anti-subsidy tariffs on imports from China.

Suntech joins a roll-call of Chinese solar groups that have pulled out of the agreement, including global heavyweights Trina Solar, JinkoSolar and JA Solar, while others such as Canadian Solar have been thrown out for alleged breaches of its terms.

Opponents of the MIP and broader fair-trade measures against Chinese imports claim the system lacks any credibility and should be scrapped, as it is damaging Europe’s solar growth prospects at a crucial time.

Industry body SolarPower Europe and more than 400 companies last week sent a letter to Brussels officials demanding the measures’ removal, reflecting the majority view of the continent’s developers and plant builders.

Europe’s rump of module manufacturers – led by Germany’s SolarWorld – argue for a tightening of measures via the EU ProSun lobbying group.

EU Pro Sun head Milan Nitzschke, who is also a vice president at SolarWorld, claimed in a statement to Recharge that Chinese companies are either “circumventing” the EU trade action by building production capacity outside China, or simply accepting the European Commission’s trade tariffs “and absorbing them, as if they were speeding tickets”.

Nitzschke added: “With a customs duty level of 50% that only works if you have the backing of the Chinese state, which bears the cost of the losses. 

“Chinese suppliers since June again are increasingly pushing into the market with prices significantly below manufacturing costs, desperately trying to reduce stockpiles that arose from massive overcapacity and the support stop in China.”