I 118th CONGRESS 2d Session H. R. 8495 IN THE HOUSE OF REPRESENTATIVES May 22, 2024 Mr. Duarte (for himself, Mr. Van Orden , and Mr. Owens ) introduced the following bill; which was referred to the Committee on Oversight and Accountability , and in addition to the Committees on Education and the Workforce , and Ways and Means , for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To ensure electric vehicle companies do not use child or slave labor in the manufacture of, or sourcing of materials for, electric vehicles.

1. Short title This Act may be cited as the EV Fair Trade Act of 2024 . 2. Prohibition of Grant (a) In general Beginning on the later of the date that is 2 years after the date of enactment or the date on which the database required under section 3(c)(1) is available, the head of an executive agency may not award Federal assistance to any electric vehicle company that develops, builds, or sells electric vehicles in the United States unless a representative of the company fulfills the certification requirement described in section 3(a) and complies with any other requirement of this Act. This prohibition applies to each stage of production, from mineral extraction to final assembly of the electric vehicle. (b) Compliance To comply with the requirement described in subsection (a), the head of an executive agency shall review the status of the certifications as maintained in the database established under section 3(c) before awarding any Federal assistance to such electric vehicle company. A company that does not have a certification in the database and does not provide proof that a representative of the electric vehicle company has submitted a certification to the Secretary pursuant to section 3(a) shall not be eligible for Federal assistance until such time as a certification has been submitted to the Secretary of Labor. A company whose representative has submitted a certificate that is determined to be false pursuant to an audit conducted under section 4 shall not be eligible for any Federal assistance until 5 years after the date on which a new certification has been submitted and audited. 3. Certifications (a) Certification (1) In general A representative of an electric vehicle company shall submit a certification to the Bureau of International Labor Affairs in a form and manner determined appropriate by the Secretary. (2) Expiration of certification A certification submitted under paragraph (1) shall expire on the date that is 3 years after the date on which the certification is submitted or upon substantial change to a major component of an electric vehicle manufactured by the electric vehicle company to which the certification applies. (b) Contents of certification A certification submitted under subsection (a)(1) shall include a statement that the electric vehicle company does not utilize materials that have been sourced through oppressive child or forced labor or slavery in its supply chain for electric vehicles sold in the United States. (c) Database (1) In general Not later than 2 years after the date of enactment of this Act, the Secretary shall establish and maintain a database, to be made available only to Federal agencies, for the purpose of tracking and managing certifications submitted under subsection (a). (2) Public database The Secretary shall make available to the public a summarized version of the certifications, which shall consist of a list of the companies that submitted a certification and whether such certification is valid. 4. Audits (a) In general On an annual basis, the Secretary, acting through the Bureau and in consultation with the Secretary of Homeland Security, shall conduct an audit, on a random basis, of not less than 10 percent of certifications submitted pursuant to section 3(a) to ensure that such certifications are accurate. (b) Additional audits In addition to the audits required under subsection (a), the Secretary shall conduct an audit of a certification submitted by an electric vehicle company if the Secretary determines that a report received under section 5(a) in relation to such company is based on credible evidence. 5. False certification allegations (a) In general Any individual may submit a report to the Bureau alleging that a certification is false. (b) Review of information The Secretary shall review a report submitted under subsection (a) to verify that the report is based upon credible evidence, which may include— (1) internal company documents; (2) whistleblower accounts; and (3) verifiable supply chain documentation. (c) False allegations If the Secretary determines that— (1) a report submitted under subsection (a) is not based on credible evidence; and (2) the report was submitted for competitive advantage, the Secretary is authorized to impose up to a $250,000 fine on entities that submit false allegations. (d) Regulations Not later than 1 year after the date of enactment of this Act, the Secretary shall issue, after opportunity for public comment, such regulations as are necessary to carry out subsections (a) and (b). 6. Report The Secretary of Labor shall submit to Congress, on an annual basis, a report that includes each of the following: (1) Each certification that the Bureau received during the preceding year. (2) A summary of audit results, including the number of certifications audited, any discrepancies found, and actions taken as a result. (3) A description of any instance in which Federal assistance was denied due to lack of certification or false certification. (4) Any challenges faced in the certification and audit processes and recommendations for improvements. (5) A description of collaborative efforts with other Federal agencies in the pursuit of ethical sourcing. (6) Any feedback from electric vehicle companies on the certification process and areas for improvement. 7. Definitions In this Act: (1) Bureau The term Bureau means the Bureau of International Labor Affairs. (2) Electric vehicle The term electric vehicle means a motor vehicle that— (A) is capable of being powered wholly or in part by an electric motor that draws electricity from one or more batteries that are capable of being charged from an internal or external source; and (B) is manufactured primarily for use on public streets, roads, and highways. (3) Electric vehicle company The term electric vehicle company means a person who is engaged in the business of manufacturing electric vehicles. (4) Executive agency The term executive agency has the meaning given agency under section 551 of title 5, United States Code. (5) Federal assistance The term Federal Assistance means any grant, contract, loan, or any form of financial assistance provided by an executive agency to an electric vehicle company. (6) Major component The term major component means any part, material, or assembly that is integral to the functionality, safety, or performance of an electric vehicle, including the following: (A) A battery cell or pack. (B) An electric motor. (C) Power electronics. (D) A drivetrain assembly. (E) A critical software module. (7) Mineral The term mineral means a naturally occurring inorganic substance extracted from the earth, which is used directly or undergoes processing for utilization in the production of electric vehicle components, including the following: (A) Lithium. (B) Cobalt. (C) Nickel. (D) Rare earth elements. (E) Copper. (F) Graphite. (G) Manganese. (8) Secretary Except where otherwise specified, the term Secretary means the Secretary of Labor. (9) Slave or child labor The term slave or child labor has the meaning given— (A) the term oppressive child labor in section 3(l) of the Fair Labor Standards Act of 1938 ( 29 U.S.C. 203(l) ); and (B) the term forced labor in section 307 of the Tariff Act ( 19 U.S.C. 1307 ). 8. Prohibition on credit or deduction for expenditures in connection with non-fair trade electric vehicle manufacturing (a) In general Part IX of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: 280I. Expenditures in connection with non-fair trade electric vehicle manufacturing (a) In general No credit or deduction shall be allowed for any amount which— (1) is paid or incurred in carrying on the trade or business of an electric vehicle company in manufacturing electric vehicles, and (2) is allocable to any period during the taxable year during which the electric vehicle company fails to comply with the EV Fair Trade Act of 2024 . (b) Electric vehicle company; electric vehicle The terms electric vehicle company and electric vehicle shall have the respective meanings given such terms by the EV Fair Trade Act of 2024 . . (b) Clerical amendment The table of sections for part IX of subchapter B of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 280I. Expenditures in connection with non-fair trade electric vehicle manufacturing. . (c) Effective date The amendments made by this section shall apply to taxable years beginning after the date that is 2 years after the date of the enactment of this Act. 9. Sunset This Act, and the requirements under this Act, shall expire on the date that is 7 years after the date of enactment of this Act, and no person shall be treated as failing to comply with this Act for any period beginning after such date.