Lee Chang-yang, Minister of Industry, "Joint Public-Private Response to Electric Vehicle Damage in the US"

Semiconductor and Battery Industry Meeting
Reviewing International Litigation After Quantum Negotiations with the US

Minister Lee Chang-yang of the Ministry of Trade, Industry and Energy is speaking at the industry meeting on responses to the U.S. Semiconductor and Electric Vehicle Support Act held on the 25th at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul. Photo by Moon Honam munonam@

The government has decided to conduct bilateral negotiations with the United States regarding the U.S. 'Inflation Reduction Act,' which discriminates against subsidies for Korean-made electric vehicles, while also considering filing a complaint with the World Trade Organization (WTO) as a last resort. Additionally, to prevent damage to domestic companies, a joint public-private response team will be formed, and comprehensive measures will be taken targeting the U.S. administration, Congress, and the White House.

On the 25th, Lee Chang-yang, Minister of Trade, Industry and Energy, stated at a meeting with the semiconductor and battery industries held at the Korea Chamber of Commerce and Industry in Jung-gu, Seoul, "Recently, the U.S. appears to be pursuing the development of advanced industries and protection of its domestic industries through laws such as the Semiconductor Support Act and the Inflation Reduction Act," adding, "Since there are concerns about damage to Korean-made electric vehicles exported to the U.S., we will form a joint public-private response team to actively respond." ▷Related article on page 6

The Inflation Reduction Act excludes electric vehicles equipped with Chinese-made batteries and critical minerals from U.S. tax credits and provides support only for electric vehicles produced and assembled domestically. Five electric vehicle models from domestic automakers, including the Ioniq 5 and EV6, do not meet the North American final assembly requirement and thus are excluded from the $7,500 tax credit.

CEOs from the industrial sector attending the meeting urged for an active and swift response regarding the Inflation Reduction Act. They particularly emphasized the need to actively persuade the U.S. by invoking the national treatment principle of the Korea-U.S. Free Trade Agreement (FTA) and the most-favored-nation principle of the WTO. They also appealed for urgent measures to protect domestic companies.

Accordingly, the government will first respond to the Inflation Reduction Act through bilateral negotiations with the U.S. government. To accelerate negotiations, a first-level senior official will be dispatched to the U.S. within this month. An Deok-geun, Director-General for Trade Negotiations at the Ministry of Trade, Industry and Energy, will also visit the U.S. in early next month to attend the Indo-Pacific Economic Framework (IPEF) ministerial meeting and convey Korea’s concerns.

The issue lies in effectiveness. Since the Biden administration hastily passed the Inflation Reduction Act in consideration of the midterm elections in November, there is little room for improvement of the bill within this year. Therefore, the government is also considering filing a complaint with the WTO or utilizing the Korea-U.S. FTA as a last resort. An official from the Ministry of Trade, Industry and Energy said, "Using the dispute resolution procedures of the WTO or the Korea-U.S. Free Trade Agreement is a last resort," adding, "Resolution through dialogue with the U.S. should precede."

This content was produced with the assistance of AI translation services.