The United States’ Inflation Reduction Act (IRA) introduces new eligibility requirements for existing USD 7,500 tax-credit provided to electric vehicles. The new requirements condition the credit upon North American final assembly and North American-sourced materials and components. As tensions flare between the US and China, these new local content requirements reflect the US’s effort to establish a supply chain for electric vehicles that circumvents China. The blow, however, is felt elsewhere, namely by South Korean auto makers whose electric vehicle models are no longer eligible for the significant tax-credit necessary to compete in the American market. As South Korea considers submitting a complaint to relevant international bodies, this paper dissects the IRA’s relevant provisions and analyzes the applicability of international trade law rules of the WTO and the Korea-US Free Trade Agreement to the new local content requirements of the IRA.

Tensions are high between Korea and Japan as a result of Japan’s export restrictions on three essential semiconductor materials exported to Korea and the removal of South Korea from their White List of countries. The Abe Administration announced that these measures were necessary to “ensure non-proliferation of weapons-related materials.” However, it is widely suspected that these measures were adopted as a retaliation against the Korean Supreme Court’s decision recognizing compensation for the forced labor victims during the Japanese occupation period. The Korean government filed a complaint concerning these measures at the WTO DSB for resolution under international law. In this research, the authors will critically analyze Japan’s export restrictions under international law to facilitate a peaceful resolution to the current conflict. This paper will tackle the relevant issues under the WTO/GATT regulations and the Korea-Japan Claims Agreement to address the issue of who violated international law.