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Rep. Elise Stefanik, Chairwoman
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Press Releases

House Republicans Continue To Counter CCP Influence

Washington, September 12, 2024
House Republicans are continuing this week’s effort to counter the threat of the Chinese Communist Party (CCP) by bringing the End Chinese Dominance of Electric Vehicles in America Act of 2024 to the Floor. This legislation prevents the Chinese Communist Party from receiving any taxpayer dollars from subsidies for electric vehicles created by the Biden-Harris Inflation Expansion Act, helping restore security in American manufacturing while combating the existential threat of CCP influence.
 
FACTS ABOUT H.R. 7980 – The End Chinese Dominance of Electric Vehicles in America Act of 2024 (Courtesy of the House Committee on Ways and Means Republicans): 
  • Background:
    • In the so-called Inflation Reduction Act (IRA), Democrats created generous new tax subsidies for electric vehicles (EVs), at an enormous cost to American taxpayers.
    • While drafting the IRA, Sen. Manchin (I-WV) tried to prevent those subsidies from going to foreign entities of concern (FEOC), like entities with ties to China or other adversaries.
    • Pushed by radical environmentalists and EV producers, the Biden-Harris Administration wrote lenient FEOC rules that benefit China.
  • Issue(s): 
    • The Biden-Harris Treasury created pro-China loopholes in its FEOC regulations.
    • Under the language of IRA, EVs are supposed to be ineligible for a tax subsidy if they contain battery components or critical minerals sourced from an FEOC. This follows a similar restriction on semiconductor grants included in the CHIPs Act signed by President Biden.
    • In September 2023, the Commerce Department issued rules under the CHIPs Act that defined an FEOC as follows: 25% or more of the entity’s voting interest, or board seats, or equity interest is held directly or indirectly by the government of a country of concern (China, Russia, North Korea, or Iran) or its officials, or by any person that is a citizen, national, or resident of such country.
    • In December 2023, Treasury issued FEOC rules for the EV tax subsidies in the IRA but opted to make their version more China-favorable than the Commerce Department’s CHIPS rule. Treasury excluded “any person that is a citizen, national, or resident” – so an entity owned by a Chinese billionaire could benefit from the EV subsidies as long as his or her ties to the Chinese Communist Party or other hostile government were unofficial.
    • Treasury also defined “battery component” very favorable to Chinese manufacturers, who, under the Treasury rules, can produce all materials and parts upstream of the battery component and remain eligible to benefit from the EV tax subsidies.
  • The End Chinese Dominance of Electric Vehicles in America Act:
    • Prevents China from receiving a windfall funded by American taxpayers.
    • Closes the Chinese billionaire loophole to ensure that Treasury follows the same definition of FEOC developed by the Commerce Department in CHIPS.
    • It also closes the Chinese manufacturing loophole to prevent China from leveraging its battery supply chain dominance to produce upstream materials, parts, and intellectual properties that are eligible for an EV tax subsidy in the United States.