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RELATED PARTY TRANSACTIONS AND BALANCES | 12 Months Ended
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Dec. 31, 2016
RELATED PARTY TRANSACTIONS AND BALANCES [Abstract] |
RELATED PARTY TRANSACTIONS AND BALANCES | 16. RELATED PARTY TRANSACTIONS AND BALANCES
| (1) | The relationships between the Group and related party are as follows:
Name of the related party |  | Relationship
Daqo Group Co., Ltd. (“Daqo Group”) |  | Daqo Group and the Group are controlled by same group of shareholders.
Zhenjiang Daqo Solar Co. Ltd. (“Zhenjiang Daqo”) |  | An affiliated company which is 100% held by Daqo Group
Daqo Solar Co. Ltd (“Daqo Solar”) |  | An affiliated company which is 100% held by Daqo Group
Nanjing Daqo New Energy Co., Ltd. (“Nanjing Daqo”) |  | An affiliated company which was 100% held by the Group before September 28, 2012 and is 100% held by Daqo Group since September 28, 2012
Daqo Xinjiang Investment Co., Ltd. ("Xinjiang Daqo Investment") |  | An affiliated company which is 100% held by Daqo Group
Daqo New Material Co., Ltd. ("Daqo New Material") |  | An affiliated company which is 100% held by Daqo Group, and was consolidated by the Company as VIE on December 31, 2013
Chongqing Daqo Tailai Electric Co., Ltd. (“Chongqing Daqo Tailai”) |  | An affiliated company which is 100% held by Daqo Group
Nanjing Daqo Transformer Systems Co., Ltd. (“Nanjing Daqo Transformer”) |  | An affiliated company which is 100% held by Daqo Group
Jiangsu Daqo Changjiang Electric Co., Ltd. (“Jiangsu Daqo”) |  | An affiliated company which is 100% held by Daqo Group
Nanjing Daqo Electric Co., Ltd. (“Nanjing Daqo Electric”) |  | An affiliated company which is 100% held by Daqo Group
Zhenjiang Klockner-Moeller Electrical Systems Co., Ltd. (“Zhenjiang Moeller”) |  | An affiliated company which is 100% held by Daqo Group
Nanjing Intelligent Apparatus Co., Ltd. (“Intelligent Apparatus”) |  | An affiliated company which is 100% held by Daqo Group
Nanjing Intelligent Software Co., Ltd. (“Intelligent Software”) |  | An affiliated company which is 100% held by Daqo Group
Daqo Investment Co., Ltd. (“Daqo Investment”) |  | An affiliated company which is 100% held by Daqo Group
Shanghai Sailfar Electric Technology Co., Ltd. (“Daqo Sailfar”) |  | An affiliated company which is 100% held by Daqo Group
Jiangsu Daquan High Voltage Switchgear Co., Ltd.( “Jiangsu Daquan High Voltage”) |  | An affiliated company which is 75% held by Daqo Group
Jiangsu Daqo Kai-fan Electric Co., Ltd. ( “Jiangsu Daqo Kai-fan”) |  | An affiliated company which is 100% held by Daqo Group
Zhenjiang Electric Equipment Co., Ltd. ( “Zhenjiang Electric”) |  | An affiliated company which is 100% held by Daqo Group
Jiangsu Daqo ETE Electronic Systerm Co., Ltd.(“Jiangsu Daqo ETE Electronic”) |  | An affiliated company which is 75% held by Daqo Group
Jiangsu Daquan Kai-fan Switchgear Co., Ltd (“Jiangsu Daquan Kai-fan Switchgear”) |  | An affiliated company which is 100% held by Daqo Group
| (2) | Related party balances:
The balances due from related parties mainly included the amount due from Zhenjiang Daqo for sales of wafer and polysilicon. The balances are as follows:
|  | December 31, |
|  | 2015 |  | 2016 |
Amounts due from related parties |  |  |  |  |  |  |
Zhenjiang Daqo |  | $ | 229,989 |  | $ | 1,449,824 |
Others |  |  | 54,644 |  |  | 78,888 |
Total |  | $ | 284,633 |  | $ | 1,528,712 |
The balances due to related parties mainly included payables to Chongqing Daqo Tailai and Nanjing Daqo Transformer for purchases of machines for polysilicon expansion, payables to Daqo Solar, Xinjiang Daqo Investment and Daqo New Material for interest free loans, and interest bearing loan from Daqo Group with an interest rate of 5.7% as of December 31, 2016. The balances are payable on demand and are as follows:
|  | December 31, |
|  | 2015 |  | 2016 |
Amounts due to related parties |  |  |  |  |  |  |
Daqo Group |  | $ | 33,758 |  | $ | 15,076,133 |
Daqo New Material |  |  | 5,563,165 |  |  | 8,323,271 |
Xinjiang Daqo investment |  |  | 3,146,054 |  |  | 79,197 |
Daqo Solar |  |  | 37,390,575 |  |  | — |
Chongqing Daqo Tailai |  |  | 144,102 |  |  | 2,107,488 |
Nanjing Daqo Transformer |  |  | — |  |  | 1,022,075 |
Others* |  |  | 118,873 |  |  | 221,441 |
Total |  | $ | 46,396,527 |  | $ | 26,829,605 |
* The remaining balance of amounts due to related parties of $221,441 as of December 31, 2016 was comprised of amounts due to Jiangsu Daqo, Zhenjiang Electric, Daqo Sailfar and Intelligent Software in the amount of $37,679, $85,332, $9,804 and $88,626, respectively.
The transactions with Daqo Group and its subsidiaries were as follows:
|  | Transaction |  | Year Ended December 31, |
Name of Related parties |  | Nature |  | 2014 |  | 2015 |  | 2016 |
Daqo Group |  | Purchase-Fixed asset |  |  | 486,948 |  |  | — |  |  | — |
|  | Proceeds from interest free loans |  |  | 10,821,462 |  |  | 15,043,550 |  |  | — |
|  | Repayment of interest free loans |  |  | 8,115,813 |  |  | 20,217,257 |  |  | 10,974,807 |
|  | Repayment of interest bearing loan |  |  | — |  |  | — |  |  | 15,059,000 |
|  | Interest charged |  |  | — |  |  | — |  |  | 850,380 |
|  | Rental expense |  |  | — |  |  | — |  |  | 27,997 |
Zhenjiang Daqo |  | Sales |  |  | 9,554,320 |  |  | 11,111,239 |  |  | 11,194,197 |
Daqo Solar |  | Sales |  |  | 9,595,680 |  |  | 783,705 |  |  | — |
|  | Proceeds from interest free loans |  |  | 157,241,390 |  |  | 127,060,826 |  |  | 60,300,896 |
|  | Repayment of interest free loans |  |  | 166,231,092 |  |  | 151,990,672 |  |  | 68,766,506 |
Nanjing Daqo |  | Proceeds from interest free loans |  |  | 973,898 |  |  | 13,456,861 |  |  | — |
|  | Repayment of interest free loans |  |  | 2,921,693 |  |  | 13,456,861 |  |  | — |
Xinjiang Daqo Investment |  | Proceeds from interest free loans |  |  | 98,367,234 |  |  | 72,946,700 |  |  | 56,270,085 |
|  | Repayment of interest free loans |  |  | 93,219,846 |  |  | 73,252,506 |  |  | 38,715,449 |
Daqo New Material |  | Proceeds from interest free loans |  |  | 7,729,501 |  |  | 11,082,241 |  |  | 9,607,344 |
|  | Repayment of interest free loans |  |  | 4,600,117 |  |  | 11,285,114 |  |  | 12,262,592 |
|  | Rental expense |  |  | 1,071,287 |  |  | 1,050,661 |  |  | 993,894 |
Chongqing Daqo Tailai |  | Purchase-Fixed asset |  |  | 2,724,790 |  |  | 375,528 |  |  | 3,534,248 |
|  | Purchase-Raw material |  |  | — |  |  | 9,938 |  |  | — |
|  | Income from disposal of fixed assets |  |  | — |  |  | 6,458 |  |  | — |
|  | Proceeds from interest free loans |  |  | — |  |  | 6,367,640 |  |  | 222,517 |
|  | Repayment of interest free loans |  |  | — |  |  | 6,367,640 |  |  | 2,684,783 |
Others subsidiaries under Daqo Group |  | Proceeds from interest free loans |  |  | 636 |  |  | — |  |  | — |
|  | Repayment of interest free loans |  |  | — |  |  | 5,296 |  |  | — |
|  | Purchase-Fixed asset* |  |  | 3,989,686 |  |  | 3,488,330 |  |  | 2,120,768 |
|  | Purchase-Raw material |  |  | — |  |  | 22,817 |  |  | 129,219 |
Total |  | Sales |  | $ | 19,150,000 |  | $ | 11,894,944 |  | $ | 11,194,197 |
|  | Income from disposal of fixed assets |  | $ | — |  | $ | 6,458 |  | $ | — |
|  | Purchase-Fixed asset |  | $ | 7,201,424 |  | $ | 3,863,858 |  | $ | 5,655,016 |
|  | Purchase-Raw material |  | $ | — |  | $ | 32,755 |  | $ | 129,219 |
|  | Rental expense |  | $ | 1,071,287 |  | $ | 1,050,661 |  | $ | 1,021,891 |
|  | Interest expense |  | $ | — |  | $ | — |  |  | 850,380 |
|  | Proceeds from related parties loans |  | $ | 275,134,122 |  | $ | 245,957,818 |  | $ | 126,400,842 |
|  | Repayment of related parties loans |  | $ | 275,088,560 |  | $ | 276,575,346 |  | $ | 148,463,137 |
*The purchases of fixed assets of $2,120,768 were comprised of purchases from Nanjing Daqo Transformer, Zhenjiang Moeller, Jiangsu Daqo, Intelligent Apparatus and Jiangsu Daqo ETE Electronic in the amount of $1,410,655, $236,415, $336,791, $93,841 and $ 43,066, respectively.

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