In reaction to a new US regulation that exempts electric vehicles made only in North America from taxation, South Korea is considering filing a protest with the World Trade Organization, according to Industry Minister Lee Chang-yang today, Monday.
The Korean Minister of Industry said, according to the South Korean News Agency, “We will consider whether to take the case to the World Trade Organization and we have conveyed to the US Trade Representative our message that the law would violate the rules of the World Trade Organization and the bilateral free trade agreement.”
Ahn Duk-kyun, the South Korean trade minister, promised to bring up the matter with US authorities during his subsequent trip to Washington, he said.
Due to the fact that they produce and export their top electric vehicles, such the IONIQ 5 and EV6, in South Korean facilities, major South Korean automakers like Hyundai Motor and Kia have expressed concern over the regulation.
The WTO’s principle of preferential treatment, according to South Korean authorities, and the norms of the bilateral free trade agreement may have both been broken by the new law.
In a phone conversation with Anthony Blinken, the US secretary of state, last Friday, Seoul’s foreign minister Park Jin expressed concern over the measure and appealed for latitude in its application.
The flagship electric car models from Hyundai and Kia have gained popularity in the US market recently. By 2030, the two companies expect to sell 3. 23 million electric vehicles worldwide, including 840,000 units in the US, or 12% of the market.
Additional tax incentives for owners of electric cars are requested by the Inflation Control Act, which US President Joe Biden approved this week, but only for cars made in North America.
Regarding the US inflation act, South Korea is considering filing a lawsuit with the World Trade Organization.
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