NEW YORK (MarketWatch) — U.S. solar panel manufacturers on Wednesday filed formal trade complaints with regulators to combat “illegal” subsidies by Chinese solar panel makers.

The newly-formed Coalition for American Solar Manufacturing submitted requests to the U.S. Department of Commerce and International Trade Commission to seek “relief from China’s illegal trade activities,” the group said in a statement.

The cases allege “dumping margins” in excess of 100% as well as “massive” subsidies by China.

Solar panel installation

“Artificially low-priced solar products from China are crippling the domestic industry,” said Gordon Brinser, president of Oregon-based SolarWorld Industries America Inc., a unit of Germany’s SolarWorld (SWV). Brinser also leads the Coalition for American Solar Manufacturing.

Julie Lydon, a spokeswoman for China-based solar panel maker Suntech Power Holding STP, +5.26% , said any U.S. protectionism could put thousands of jobs at risk.

“A solar trade war would deal a major blow to the world economy and to our common goal of achieving a clean energy future,” Lydon said in an e-mail to MarketWatch.

SolarWorld is asking the U.S. government to impose duties “to provide relief” for manufacturers of traditional, crystalline solar panels. The request does not cover makers of thin-film solar panels such as First Solar. The case also excludes other types of solar power such as thermal solar, which uses heat from the sun to create steam to drive generators.

“The Chinese do not play by the rules,” said Sen. Ron Wyden, Democrat from Oregon, who attended the press conference for the coalition.

Brinser, who leads the coalition of seven domestic manufacturers, said China’s attempt to dismantle the U.S. industry has cost thousands of jobs.

“China’s wrongful tactics run systematically across the board; central planning has subsidized most facets of these companies’ business,” Brinser said. “China actually has no production cost advantage. Labor makes up a modest share of solar-industry costs, China’s labor is less productive, its raw material and equipment have come from the West and China must pay for long-distance shipping. Yet massive state subsidies and sponsorship have enabled Chinese manufacturers to illegally dump their products into a wide-open U.S. market.”

The effort comes as lower margins in solar panels have driven shares of solar companies down on both sides of the Pacific. Just last week, First Solar FSLR, +0.66% , the only pure-play solar panel manufacturer in the S&P 500, saw its shares fall to their lowest level since 2007.

Shares of First Solar fell 6.4% to $52.35 on Wednesday.

In the U.S., solar panel manufacturer Solyndra went bankrupt earlier this year, touching off a political battle over its federal loan guarantee of $535 million.

Besides Solyndra, other manufacturers have also gone bankrupt including Evergreen Solar and SpectraWatt.