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United States

US government sued over wind farm development ban

UNITED STATES: A company owned by two executives at Chinese turbine manufacturer Sany Electric is suing the US Government after it was served with an order stopping it from developing a series of windfarm sites in Oregon.

A Sany 2MW turbine under construction
A Sany 2MW turbine under construction

Ralls Corporation issued the lawsuit late last week, claiming that the Committee on Foreign Investment in the United States (CFIUS) had violated the US constitution and the Administrative Procedure Act.

The committee had ruled that Ralls Corporation’s proposed windfarms would provide a threat to national security.

The lawsuit states: "CFIUS violated the foregoing principles and well-established law when it issued an order subjecting plaintiff Ralls Corporation to draconian obligations in connection with Ralls’s acquisition of four small Oregon companies whose assets consisted solely of windfarm development rights, including land rights to construct the windfarms, power purchase agreements, and necessary government permits."

It said that CFIUS had not explained any reasons for its decision, and that in any case it had exceeded its powers.

Earlier this year, Ralls Corporation bought the rights to four companies, which held land rights to build windfarms in Oregon.

However, shortly after Ralls acquired the firms, the US Navy expressed concerns with regard to the location of one of the projects.

Ralls says that it agreed to move the farm at its own expense, but was still served with notice by CFIUS.

The lawsuit states: "By ordering Ralls immediately to cease all construction at the project sites, remove all equipment from the sites, and cease all access to the sites (including communications with persons at the sites), CFIUS has not merely mitigated any national security risks associated with the transaction; its actions are tantamount to prohibiting the transaction entirely, a power CFIUS does not possess under statute or regulation."

Ralls Corporation is a Delaware corporation privately owned by Sany CFO Dawei Duan and Sany vice president Jialiang Wu. Sany Electric is the actual controller of Ralls (Sany Electric owns 100% of Ralls).

Earlier this month, Chinese real estate firm Yeland Corporation pulled out of a deal to buy the sites from Ralls, citing concerns over the approval process.

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