US senator-IRA
U.S. senator voices concern over China-Korea joint EV battery ventures, calls for strict rules
By Song Sang-ho
WASHINGTON, Nov. 13 (Yonhap) -- A U.S. senator called on the Treasury Department on Monday to impose the "strictest possible" standards to preclude Chinese battery firms from getting electric vehicle (EV) tax credits, while expressing concern over their pursuit of joint ventures in South Korea and Morocco.
Senator Joe Manchin, chair of the Senate Energy and Natural Resources Committee, made the call in a letter to Treasury Secretary Janet Yellen, urging her department to employ tough standards for any "foreign entity of concern (FEOC)" under the Inflation Reduction Act (IRA), according to his office.
The FEOC rule excludes battery manufacturers from China and other countries of concern from tax incentives under the IRA.
"I urge you to impose the strictest possible standards for FEOCs to ensure the minerals in electric vehicles are, to the greatest extent possible, sourced in the United States or from legitimate allies," he wrote in the letter.
"I am incredibly concerned by recent reports that suggest Chinese battery companies are actively pursuing business opportunities and arrangements, including joint ventures and investments, in South Korea and Morocco to take advantage of the IRA," he added.
The senator stressed that China has a "long" history of circumventing U.S. trade laws.
"The incentives Congress provided in the IRA for domestic manufacturers, and our friends and allies with which the United States has free trade agreements, cannot be allowed to be hijacked by adversaries engaging in 'mineral laundering,'" he said.
The IRA offers tax credits of up to US$7,500 to each buyer of a new electric vehicle only assembled in North America. It also requires EV batteries to be made with a certain portion of minerals mined or processed in the U.S. or countries or regions that have free trade agreements with the U.S.
(END)
(C) Yonhap News Agency. All Rights Reserved
