U.S. issues rules on 'foreign entity of concern' ineligible for EV car tax credit

▲ This EPA file photo shows a supercharger station in California, on June 22, 2023. (PHOTO NOT FOR SALE) (Yonhap)

US-FEOC guidance

U.S. issues rules on 'foreign entity of concern' ineligible for EV car tax credit

By Song Sang-ho

WASHINGTON, Dec. 1 (Yonhap) -- The United States on Friday released proposed guidance defining a "foreign entity of concern (FEOC)" in a move to clarify its rules aimed at blocking tax credits for electric vehicles (EVs) with battery components and critical minerals from China.

The Treasury Department announced the long-awaited rules of the 2022 Inflation Reduction Act (IRA) as South Korean battery makers have stressed the need to clarify the FEOC requirements to address uncertainties in their overseas operations and investments.

Under the rules, beginning in 2025, an EV eligible for tax credits may not contain any critical minerals that were extracted, processed or recycled by a FEOC. Starting next year, an eligible EV may not contain any battery components that were manufactured or assembled by a FEOC.

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